ABC Co.has paid annual dividends in the past five years of $.20,$.25,$.28,$.33,and $.36.Calculate the average growth rate of its dividends.

Name: ABC Co.has paid annual dividends in the past five years of $.20,$.25,$.28,$.33,and $.36.Calculate the average growth rate of its dividends.
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Question

Quizplus · Accepted Answer

$$\begin{array}{l}
\text { Average thyitend yowth rate }\
= \left[ D _ { n } / D _ { 0 } \right] 1 / n - 1\
= [ \$.36 /\$.20  ] 1 / 4 - 1\
= [ 1.80 ] 1 / 4 - 1\
= 1,1583 - 1 = .1583 \text { or } 15.83\%
\end{array}$$

ABC Cohas Paid Annual Dividends in the Past Five Years of of $.20,$.25,$.28,$.33,and