Declining Corporation just paid a dividend of $1.23 and has an expected growth rate of -5% for the foreseeable future,if the discount rate is 7% what is the appropriate stock price today?

Name: Declining Corporation just paid a dividend of $1.23 and has an expected growth rate of -5% for the foreseeable future,if the discount rate is 7% what is the appropriate stock price today?
Brand: Quizplus
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Question

Quizplus · Accepted Answer

g= -0.05 D₀= 1.23 D₁= 1.17 r= 0.07 P₀= D₁/(r-g) P₀= 9.74

Declining Corporation Just Paid a Dividend of $1