Davin Wenig, an investor with a 13% required rate of return, wants to buy shares of eBay (ticker symbol: EBAY). EBAY’s shareholders just received an annual dividend of $2.10 per share. If EBAY has been decreasing its dividends by 11.5% each year, how much will Mr. Wenig be willing to pay today for one share of EBAY? a. $7.59 b. $10.25 c. $18.26 d. $8.02 e. $9.56
Davin Wenig, an investor with a 13% required rate of return, wants to buy shares of eBay (ticker symbol: EBAY). EBAY’s shareholders just received an annual dividend of $2.10 per share. If EBAY has been decreasing its dividends by 11.5% each year, how much will Mr. Wenig be willing to pay today for one share of EBAY? a. $7.59 b. $10.25 c. $18.26 d. $8.02 e. $9.56
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Davin Wenig, an investor with a 13% required a. $7.59
b. $10.25
c. $18.26
d. $8.02
e. $9.56
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