
Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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Transcribed Image Text:Walter Utilities is a dividend-paying company and is expected to pay an annual dividend of $1.25 at the end of the year. Its dividend is expected to
grow at a constant rate of 7.50% per year. If Walter's stock currently trades for $13.00 per share, what is the expected rate of return?
7.59%
8.32%
17.12%
12.62%
Walter's dividend is expected to grow at a constant growth rate of 7.50% per year. What do you expect to happen to Walter's expected dividend yield
in the future?
It will increase.
It will decrease.
It will stay the same.
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