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VikaD [51]
3 years ago
13

Ecolap inc. (ecl) recently paid a $1.02 dividend. The dividend is expected to grow at a 15.12 percent rate. At a current stock p

rice of $71.75, what return are shareholders expecting? (do not round intermediate calculations. Round your answer to 2 decimal places. (e.G., 32.16))
Business
1 answer:
weqwewe [10]3 years ago
6 0

<u>Calculation of Expected rate of return:</u>


The expected rate of return can be calculated using the following formula:


Expected rate of return = (Current Dividend * (1+growth rate) / Price)  +  Growth rate

It is given that Ecolap inc. (ecl) recently paid a $1.02 dividend. The dividend is expected to grow at a 15.12 percent rate. And the current stock price is $71.75.

Hence, Expected rate of return = (1.02*(1+0.1512)/71.75)+0.1512

=(1.174224/71.75)+0.1512

=0.01637+0.1512

=0.1676

=16.76%


Hence, the expected rate of return is <u>16.76%</u>




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Answer:

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3 years ago
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Answer:

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4 0
3 years ago
When might you expect a manager to offer a gentle reminder about hand washing?
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Hello!

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