ABC Inc. is planning on paying an annual dividend of $1.80 per share next year. The company has a policy of increasing the dividend by 3% annually. As far as they know, the company will pay dividends for the foreseeable future. If the required return is 14 percent, what is the current stock price?
A) $18.32
B) $20.77
C) $26.08
D) $24.26
E) $16.36
Correct Answer:
Verified
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