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kipiarov [429]
3 years ago
9

A common stock pays an annual dividend per share of $2.10. The market capitalization rate (required return on equity) is 10.0%.

If the annual dividend is expected to remain at $2.10, what is the value of the stock
Business
1 answer:
Inessa05 [86]3 years ago
3 0

Answer:

the  value of the stock is $21

Explanation:

The computation of the value of the stock is given below:

= Annual dividend per share ÷ required rate of return

= $2.10 ÷ 10%

= $21

Hence, the  value of the stock is $21

We simply divided the annual dividend from the required rate of return so that the value of the stock could come

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