The dividends and stock price of Mimi Company are expected to grow at 5 percent per year at very far future year. Mimi's common stock sells for P25 per share, its last dividend was P2.50, Mimi should pay P2.50 flotation cost. What is the expected return on retained earnings for Mimi Company? a. 15.00 percent b.16.11 percent c.15.5 percent d.16.67 percent

EBK CONTEMPORARY FINANCIAL MANAGEMENT
14th Edition
ISBN:9781337514835
Author:MOYER
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Chapter7: Common Stock: Characteristics, Valuation, And Issuance
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The dividends and stock price of Mimi Company are expected to grow at 5 percent per year at very far future year. Mimi's common stock sells for P25 per share, its last dividend was P2.50, Mimi should pay P2.50 flotation cost. What is the expected return on retained earnings for Mimi Company?

a. 15.00 percent

b.16.11 percent

c.15.5 percent

d.16.67 percent

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