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A Stock Paying $5 in Annual Dividends Currently Sells for $80

Question 28

Multiple Choice

A stock paying $5 in annual dividends currently sells for $80 and has an expected return of 14%.What might investors expect to pay for the stock one year from now after the next dividend has been paid?


A) $82.20
B) $86.20
C) $87.20
D) $91.20

Correct Answer:

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