Question
Pfender Guitars has a current annual cash dividend policy of $4.00. The price of the stock is set to yield a return of 8%. What
Pfender Guitars has a current annual cash dividend policy of $4.00. The price of the stock is set to yield a return of 8%. What is the price of this stock if the dividend will be paid a. for 10 years and then the company repurchases the stock for $25? b. for 15 years and then the company repurchases the stock for $25? c. for 40 years and then the company repurchases the stock for $25? d. for 60 years and then the company repurchases the stock for $25? e. for 100 years and then the company repurchases the stock for $25? f. forever with no repurchase of the stock?
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