Required rate return on the stock


Woidtke Manufacturing's stock a firm sells for $20.00 a share. A stock just paid a dividend of $1.00 a share (i.e. D0 = $1.00) and the dividend is expected to grow for ever at a constant rate of 10% a year. What stock price is expected one year from now?

What is the required rate return on the stock?

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Finance Basics: Required rate return on the stock
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