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Question 31 Wakon company earned $3.25 per share and paid dividends of $0.75 per share. The...

Question 31

Wakon company earned $3.25 per share and paid dividends of $0.75 per share. The company reported a dividend yield of 3 percent.

What was the price of Wakon’s stock? (Round your answer 2 decimal places).

Market price per share { ?   } .

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Answer #1

Answer)

     Calculation of Market Price per share of Wakon’s Company

Facts of the Question:

Earnings Per Share

$ 3.25

Dividend per share

$ 0.75

Dividend yield

3%

Dividend yield = Dividend per share/ Earning per share

                     3% = $ 0.75/ Market Price per share

Therefore,

Market price per share = $ 0.75/ 3%

                                          = $ 25.00

Therefore the market price per share of Wakon’s Company is $ 25.00

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