The last dividend on Spirex Corporation’s common stock was $4.00, and
The last dividend on Spirex Corporation’s common stock was $4.00, and the expected growth rate is 10%. If you require a rate of return of 20%, what is the highest price you should be willing to pay for this stock?
A) $44.00
B) $38.50
C) $40.00
D) $45.69
E) $50.00
ANSWER
A
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