Burnett Corp. pays a constant $27 dividend on its stock. The company will maintain this dividend for the next 11 years and will then cease paying dividends forever. If the required return on this stock is 13 percent, what is the current share price? Multiple Choice $173.51 $297.00 $161.22 $153.55 $150.48
current share price=$27*Present value of annuity factor(13%,11)
Present value of annuity=Annuity[1-(1+interest rate)^-time period]/rate
=27[1-(1.13)^-11]/0.13
=27*5.686941129
=$153.55(Approx).
Burnett Corp. pays a constant $27 dividend on its stock. The company will maintain this dividend...
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