A company just paid a dividend of $1.50 per share on its stock. The dividends are expected to grow at a constant rate of 4 percent per year indefinitely.The next dividend payment of a stock will be $2.50 per share. The dividends are anticipated to maintain a growth rate of 4.5 percent forever. If the stock currently sells for $62.50 per share, what is the required return?

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Asked Nov 24, 2019
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A company just paid a dividend of $1.50 per share on its stock. The dividends are expected to grow at a constant rate of 4 percent per year indefinitely.

The next dividend payment of a stock will be $2.50 per share. The dividends are anticipated to maintain a growth rate of 4.5 percent forever. If the stock currently sells for $62.50 per share, what is the required return?

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Required Return: It is the rate of return which is the least satisfactory return an investor may anticipate on the...

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