Premier, Incorporated, has an odd dividend policy. The company has just paid a dividend of $10.35 per share and has announced that it will increase the dividend by $9.50 per share for each of the next four years, and then never pay another dividend. If you require a return of 12 percent on the company's stock, how much will you pay for a share today? Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16. X Answer is complete but not entirely correct. Current share price $ 60.10 x
Premier, Incorporated, has an odd dividend policy. The company has just paid a dividend of $10.35 per share and has announced that it will increase the dividend by $9.50 per share for each of the next four years, and then never pay another dividend. If you require a return of 12 percent on the company's stock, how much will you pay for a share today? Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16. X Answer is complete but not entirely correct. Current share price $ 60.10 x
Chapter7: Common Stock: Characteristics, Valuation, And Issuance
Section: Chapter Questions
Problem 8P
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Transcribed Image Text:Premier, Incorporated, has an odd dividend policy. The company has just paid a dividend of $10.35 per share and has announced that
it will increase the dividend by $9.50 per share for each of the next four years, and then never pay another dividend. If you require a
return of 12 percent on the company's stock, how much will you pay for a share today?
Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.
4
99+
X Answer is complete but not entirely correct.
Current share price
W
X
P
A
60.10 x
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