Given the following information, what is the average annual dividend growth rate?

Question

Quizplus · Accepted Answer

Using the dividend growth rate formula (annual dividend per share at end of period – annual dividend per share at beginning of period) / annual dividend per share at beginning of period, we get:

(0.096-0.084)/0.084 = 0.1429 = 14.29%

Therefore, the average annual dividend growth rate is 14.29%/3 = 4.762%, which is closest to answer choice C) 4.1%.

Given the Following Information, What Is the Average Annual Dividend