Oweninc has a current stock price of $13.00 and is expected to pay a $0.85 dividend in one year. If Owenlnc's equity cost of capital is 11%, what price would Oweninc's stock be expected to sell for immediately after it pays the dividend? OA. $9.51 OB. $13.58 OC. $14.43 OD. $10.86

Oweninc has a current stock price of $13.00 and is expected to pay a $0.85 dividend in one year. If Owenlnc's equity cost of capital is 11%, what price would Oweninc's stock be expected to sell for immediately after it pays the dividend? OA. $9.51 OB. $13.58 OC. $14.43 OD. $10.86

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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Question

Oweninc has a current stock price of $13.00 and is expected to pay a $0,85 dividend in one year. If Oweninc's equity cost
of capital is 11%, what price would Oweninc's stock be expected to sell for immediately after it pays the dividend?
OA. $9.51
OB. $13.58
OC. $14.43
OD. $10.86
Mayt

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