A stock is expected to pay a dividend of $3.19 at the end of the year. The required rate of return is 7.7% and the expected constant growth rate is g= 4%. What is the stock's current price? (Answer in $s to the nearest cent, xx.xx, with no $ sign or commas needed.)
Current price=D1/(Required return-Growth rate)
=3.19/(0.077-0.04)
which is equal to
=86.22(Approx).
A stock is expected to pay a dividend of $3.19 at the end of the year....
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