Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Excel Inc. is planning to pay a dividend of $2.80 in the next year and expects to grow the dividend at a constant rate of
Excel Inc. is planning to pay a dividend of $2.80 in the next year and expects to grow the dividend at a constant rate of 5% per year, indefinitely. If the required rate of return by shareholders is 11%, then the price of this stock should be ________.
A)$49.00
B)$51.80
C)$56.00
D)$42.04
E)none of the above
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started