A stock is expected to pay a dividend next year of $2.1. The dividend amount isexpected to grow at an annual rate of 6.9% indefinitely. Assuming a required returnon the stock of 10.8% in the future, the dividend yield on the stock is%.Margin of error for correct responses: +/- .05Rounding and Formatting instructions:Do not enter dollar signs, percent signs, commas, X, or any words in your response. Donot round any intermediate work, but round your *final* response to 2 decimal places(example: if your answer is 12.3456, 12.3456%, or $12.3456, you should enter12.35).

The dividend yield is a financial ratio that measures the annual dividend income an investor can…

Answered: the dividend yield on the stock is %.

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the dividend yield on the stock is %.

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

A stock is expected to pay a dividend next year of $2.1. The dividend amount is
expected to grow at an annual rate of 6.9% indefinitely. Assuming a required return
on the stock of 10.8% in the future, the dividend yield on the stock is
%.
Margin of error for correct responses: +/- .05
Rounding and Formatting instructions:
Do not enter dollar signs, percent signs, commas, X, or any words in your response. Do
not round any intermediate work, but round your *final* response to 2 decimal places
(example: if your answer is 12.3456, 12.3456%, or $12.3456, you should enter
12.35).

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