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Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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Five Star Corporation will pay a dividend of $2.50 per share next year. The company
pledges to increase its dividend by 3 percent per year indefinitely. If you require a return
of 10 percent on your investment, how much will you pay for the company's stock today?
(Do not round intermediate calculations and round your answer to 2 decimal places,
e.g., 32.16.)
Mc
Graw
Hill
Stock price
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Transcribed Image Text:es
Five Star Corporation will pay a dividend of $2.50 per share next year. The company
pledges to increase its dividend by 3 percent per year indefinitely. If you require a return
of 10 percent on your investment, how much will you pay for the company's stock today?
(Do not round intermediate calculations and round your answer to 2 decimal places,
e.g., 32.16.)
Mc
Graw
Hill
Stock price
@
2
W
S
X
#3
Q
E
D
$
4
R
LL
F
do 5
%
C V
T
< Prev
G
6
5 of 8
Y
B
&
7
H
Next >
U
* 00
8
N
J
F
1
(
- O
9
K
M
-O
O
4
L
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