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A Firm Just Paid $2

Question 11

Multiple Choice

A firm just paid $2.00 on its common stock and expects to continue paying dividends,which are expected to grow 5% each year,from now to infinity.If the required rate of return for this stock is 9%,then the value of the stock is


A) $50.00.
B) $40.00.
C) $54.50.
D) $52.50.

Correct Answer:

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