You just paid $50 for a share of stock which pays annual dividends. You expect to receive the first dividend payment of
Posted: Tue Nov 16, 2021 7:47 am
You just paid $50 for a share of stock which pays annual
dividends. You expect to receive the first dividend payment of $5
one year from now. After that, you expect dividends to increase by
$X each year, forever. The price you paid implies that you would be
happy with an annual return of 12%. What is X?
dividends. You expect to receive the first dividend payment of $5
one year from now. After that, you expect dividends to increase by
$X each year, forever. The price you paid implies that you would be
happy with an annual return of 12%. What is X?