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Teder Corporation stock currently sells for $65 pe...




Teder Corporation stock currently sells for $65 per share. The market requires a 12 percent return on the firm's stock. Required : If the company maintains a constant 7 percent growth rate in dividends, what was the most recent dividend per share paid on the stock? Multiple Choice (answer options): $3.25 $12.42 $3.04 $5.16 $2.92,Thank you for answering this so quickly. I submitted the answer you gave me and it came back as incorrect. No worries though, it gave me the correct answer for reference (see below). Have a good day! :) We are given the stock price, the dividend growth rate, and the required return, and are asked to find the dividend. Using the constant dividend growth model, we get: P0 = $65 = D0 (1 + g) / (R ? g) Solving this equation for the dividend gives us: D0 = $65(0.12 ? 0.07) / (1.07) D0 = $3.04


Paper#1481 | Written in 18-Jul-2015

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