Question
Packman Corporation will pay its shareholders $5 dividends per share next year (year 1). The dividends are expected to grow at 4% every year. The
Packman Corporation will pay its shareholders $5 dividends per share next year (year 1). The dividends are expected to grow at 4% every year. The required rate of return on equity is 9%. What should be the fundamental value of its stock price (per share) today?
A. $100.0
B. $92.5
C. $83.3
D. $71.4
E. $60.0
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Fundamentals of Investment Management
Authors: Geoffrey Hirt, Stanley Block
10th edition
0078034620, 978-0078034626
