Question

The James River Co. pays an annual dividend of $1.50 per share on its common stock. This dividend amount has been constant for the past 15 years and is expected to remain constant. Given this, one share of James River Co. stock:
A. is valued as if the dividend paid is a perpetuity
B. has a market value equal to the present value of $1.50 paid one year from today
C. is basically worthless as it offers no growth potential
D. is valued with an assumed growth rate of 3%
E. has a market value of $15.00.

Answer 1

I think the answer is B.
Hope this help