IBIS Corporation has had dividends grow from $2.10 per share to $6.80 per share over the last 10 years (th $6.80 per share dividend was paid yesterday; that is, DO = $6.80). This compounded annual growth rate dividends is expected to continue into the future forever. If the current market price of IBIS's stock is $56.00 per share, what rate of return do investors expect to receive from buying IBIS stock? (Record your answer rounded to 1 decimal place; for example, record 18.29654% as 18.3).
IBIS Corporation has had dividends grow from $2.10 per share to $6.80 per share over the last 10 years (th $6.80 per share dividend was paid yesterday; that is, DO = $6.80). This compounded annual growth rate dividends is expected to continue into the future forever. If the current market price of IBIS's stock is $56.00 per share, what rate of return do investors expect to receive from buying IBIS stock? (Record your answer rounded to 1 decimal place; for example, record 18.29654% as 18.3).
Chapter7: Common Stock: Characteristics, Valuation, And Issuance
Section: Chapter Questions
Problem 6P
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Transcribed Image Text:IBIS Corporation has had dividends grow from $2.10 per share to $6.80 per share over the last 10 years (the
$6.80 per share dividend was paid yesterday; that is, D0 = $6.80). This compounded annual growth rate in
dividends is expected to continue into the future forever. If the current market price of IBIS's stock is $56.00
per share, what rate of return do investors expect to receive from buying IBIS stock? (Record your answer
rounded to 1 decimal place; for example, record 18.29654% as 18.3).
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