Question
Common stock valueConstant growthPersonal Finance ProblemOver the past 6 years, Elk County Telephone has paid the dividends shown in the following table, LOADING... . The
Common stock
valueConstant
growthPersonal Finance ProblemOver the past 6 years, Elk County Telephone has paid the dividends shown in the following table,
LOADING...
. The firm's dividend per share in
2023
is expected to be
$10.12.
a.If you can earn
15%
on similar-risk investments, what is the most you would be willing to pay per share in
2022,
just after the
$9.73
dividend?b.If you can earn only
12%
on similar-risk investments, what is the most you would be willing to pay per share?
c.Compare your findings in parts a and b, what is the impact of changing risk on share value?
Question content area bottom
Part 1
a.If you can earn
15%
on similar-risk investments, the most you would be willing to pay per share is
$enter your response here.
(Round to the nearest cent.)
| Year | Dividend per share |
| 2022 | $9.73 |
| 2021 | $9.36 |
| 2020 | $9.00 |
| 2019 | $8.65 |
| 2018 | $8.32 |
| 2017 | $8.00 |
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