The ELL common stock pays an annual dividend of $2.23 a share and is committed to maintaining a constant dividend. How much are you willing to pay for one share of this stock if your required return is 16 percent?
Select one:
A. $14.04
B. $13.94
C. $14.56
D. $14.67
E. $13.88
Current price=annual dividend/required rate
Which is equal to
=(2.23/0.16)
Which is equal to
=$13.94(approx).
The ELL common stock pays an annual dividend of $2.23 a share and is committed to...
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