Rose Hill Trading Company is expected to have EPS in the upcoming year of $8. The expected ROE is 18%. An appropriate required return on the stock is 14%. If the firm has a plowback ratio of 70%, its dividend in the upcoming year should be ________.
A) $1.12
B) $1.44
C) $2.40
D) $5.60
Correct Answer:
Verified
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