Over the past 7 years the dividends of Sunshine Mining have grown from $0.24 to the current level of $0.53. What is the approximate annual compound growth rate of Sunshine's dividends?

Question

Quizplus · Accepted Answer

The formula for annual compound growth rate is ((ending value / beginning value)^(1/number of periods))-1. Plugging in the values, we get ((0.53 / 0.24)^(1/7))-1, which simplifies to approximately 12.0%. Therefore, the best choice is B.

Over the Past 7 Years the Dividends of Sunshine Mining