Rate at which dividends are expected grow in the future


Question: A company stock has a current market value of 40.50. The co. just paid a dividend = to 1.50 per share, which is expected to grow at a constant rate forever into the future. If the co. marginal investors require a rte of return = to 12%, what is the rate at which dividends are expected grow in the future.

  • 8.3%
  • 12.0
  • 4,0
  • 8.0

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Accounting Basics: Rate at which dividends are expected grow in the future
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