A company pays an annual dividend of 15 USD. There is no growth in the amount of dividends and the requires rate of return is 10%. So, according to the dividend discount model, the fair price of the share is equal to

A company pays an annual dividend of 15 USD. There is no growth in the amount of dividends and the requires rate of return is 10%. So, according to the dividend discount model, the fair price of the share is equal to

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter12: The Cost Of Capital

Section: Chapter Questions

Problem 5P

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Question

130.

Subject :- Finance

A company pays an annual dividend of 15 USD. There
is no growth in the amount of dividends and the
requires rate of return is 10%. So, according to the
dividend discount model, the fair price of the share is
equal to
a.
b.
C.
d.
10 USD
100 USD
150 USD
15 USD

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