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Stock A has an earnings of $5 per share at year 1. The interest rate is 20%, and the return on equity is 25%. If
Stock A has an earnings of $5 per share at year 1. The interest rate is 20%, and the return on equity is 25%. If there is no plow-back, what is the dividend per share at year 0 (DIV0) ?
a. $5.00
b. $4.00
c. $3.00
d. $2.00
e. none of the above
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