What annual rate of return expected on investment


Gough Fraser is considering purchasing the stock of ASIOA Companies, which he plans to hold indefinitely. ASIOA just paid an annual dividend of $2.50 and the price of the stock is $48 per share. The earnings and dividends of the company are expected to grow forever at a rate of 6 percent per year. What annual rate of return does Gough expect on his investment?

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Microeconomics: What annual rate of return expected on investment
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