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A zero-growth common stock pays the annual dividend of $ 1.75 per share at the end...

A zero-growth common stock pays the annual dividend of $ 1.75 per share at the end of each year. If the required rate of return on the common stock is 11.2 %, what is the price per share of the common stock today?

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Expert Solution

Value of common stock today=Annual dividend/required rate of return

=$1.75/0.112=$15.625.

jeff jeffy answered 2 years ago
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