Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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You expect a share of stock to pay dividends of $1.30, $1.55, and $1.60 in each of the next 3 years. You believe the stock will sell for $22.00 at the end of the third year.
a. What is the stock price if the discount rate for the stock is 20%?
b. What is the dividend yield for year 1?
c. What will be the dividend yield at the start of year 2?
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