Question
KNX Corp commits to pay a dividend of $5.20 in year 1, $6.0 in year 2, and $7.5 in year 3, a share. After that,
KNX Corp commits to pay a dividend of $5.20 in year 1, $6.0 in year 2, and $7.5 in year 3, a share. After that, the annual dividend will be $11.00 per share indefinitely.
What is the value of KNX Corp today assuming investors require a return of 9.8 percent?
A. $114.7
B. $82.1
C. $100.2
D.
$66.70
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Risk Management And Insurance
Authors: James TrieschmannSandra GustavsonSandra Gustavson, Robert HoytSandra Gustavson, Robert Hoyt, David Sommer
12th Edition
0324183208, 9780324183207
