Question

her n canh or an additional shares of stock 100% the dhoice of recng dide dividends pricr to the prefemed shareholiders during the preemptive period Collapse wone per hare of ck ed to QUESTION Better Pletics is a mae m ng The em paid a S4 anmual dividend (Dol, but management expects to reduce the payout by peet pr ye, indefinitelly you a 12 pencet eum on this ssck, what will you pay for a share today? A $23.09 $27 s30. 2587 QUSTION 11 percent, and a 40 percent dividend payout ratio. What is the sustainable gre

better plastics is a manufacturing firm. the company just oaud a $4 annual dividend, but management expects to reduxe the payout by 3 percent per year, indefinitely. if you require a 12 percent return on this stoxj, what will you pay for the share today?

Answer 1

growth rate = -3% Return = 12 % Dividend at (time=0) = 4 Dividend at (time =1) = 4* (1+ growth rate) = 4* (1-.03) = 3.88 share value todoy - Dividend at (time = 1) Return - growth rate = 3. 88 12 - (-:03) $25.87 Answer. option Do