Question
Suppose that you are willing to pay $450.33 today for a share of stock which you expect to sell at the end of one year
Suppose that you are willing to pay $450.33 today for a share of stock which you expect to sell at the end of one year for $500.25.
If you require an annual rate of return of 15 percent, what should be the estimate of the amount of the annual dividend which you expect to receive by the end of Year 1 prior to the sale of the stock?
Assume that the estimated return equals the required rate of return.
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Fundamentals Of Corporate Finance
Authors: Jonathan Berk, Peter DeMarzo, Jarrad Harford
5th Edition
0135811600, 978-0135811603
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