Unique Stores common stock pays a constant annual dividend of $1.75 a share.What is the value of this stock at a discount rate of 13.25 percent?
A)$12.50
B)$13.33
C)$13.21
D)$12.88
E)$14.18

Question

Quizplus · Accepted Answer

To calculate the value of a stock with a constant dividend payment, we can use the dividend discount model:

Value of Stock = Dividend / Discount Rate

Plugging in the given values, we get:

Value of Stock = $1.75 / 0.1325 = $13.21

Therefore, the answer is C) $13.21.

Unique Stores Common Stock Pays a Constant Annual Dividend of $1.75