Question
Assume Evco, Inc. has a current stock price of $45.36 and will pay a $2.25 dividend in one year; its equity cost of capital is
Assume Evco, Inc. has a current stock price of $45.36 and will pay a $2.25 dividend in one year; its equity cost of capital is 12%.
What price must you expect Evco stock to sell for immediately after the firm pays the dividend in one year to justify its current price?
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Contemporary Economics An Applications Approach
Authors: Robert Carbaugh
8th Edition
1138652199, 978-1138652194
