An investor is contemplating the purchase of common stock at the beginning of this year and to hold the stock for one year. The investor expects the year-end dividend to be P2.00 and expects a year-end price for the stock of P40. If this investor’s required rate of return is 10%, then the value of the stock to this investor is: Group of answer choices P34.88. P38.18. P33.06. P36.36.
An investor is contemplating the purchase of common stock at the beginning of this year and to hold the stock for one year. The investor expects the year-end dividend to be P2.00 and expects a year-end price for the stock of P40. If this investor’s required rate of return is 10%, then the value of the stock to this investor is: Group of answer choices P34.88. P38.18. P33.06. P36.36.
Intermediate Financial Management (MindTap Course List)
13th Edition
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Eugene F. Brigham, Phillip R. Daves
Chapter8: Basic Stock Valuation
Section: Chapter Questions
Problem 2P
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Question
21
An investor is contemplating the purchase of common stock at the beginning of this year and to hold the stock for one year. The investor expects the year-end dividend to be P2.00 and expects a year-end price for the stock of P40. If this investor’s required
Group of answer choices
P34.88.
P38.18.
P33.06.
P36.36.
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