Stock X has the following data. Assuming the stock market is efficient and the stock is in equilibrium, which of the following statements is CORRECT?
Expected dividend, D1 | $3.00 |
Current Price, P0 | $50 |
Expected constant growth rate | 6.0% |
| a. The stock's expected dividend yield is 5%. | |
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| b. The stock's expected price 10 years from now is $100.00. | |
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| c. The stock's expected capital gains yield is 5%. | |
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| d. The stock's required return is 10%. | |
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| e. The stock's expected dividend yield and growth rate are equal. |
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-f D0 = $1.00, g (which is constant) = 3.6%, and P0 = $33.00, then what is the stock's expected total return for the coming year?