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Dalton Inc. has a return on equity of 11.1 percent and retains 54 percent of its earnings for reinvestment purposes. It recently paid a dividend
Dalton Inc. has a return on equity of 11.1 percent and retains 54 percent of its earnings for reinvestment purposes. It recently paid a dividend of $
3.50 and the stock is currently selling for $ 38.
a. What is the growth rate for Dalton Inc.?
b. What is the expected return for Dalton's stock?
c. If you require a 13 percent return, should you invest in the firm?
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Financial management theory and practice
Authors: Eugene F. Brigham and Michael C. Ehrhardt
12th Edition
978-0030243998, 30243998, 324422695, 978-0324422696
