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The next dividend payment by Wyatt, Inc., will be $3.05 per share. The dividends

ID: 2628893 • Letter: T

Question

The next dividend payment by Wyatt, Inc., will be $3.05 per share. The dividends are anticipated to maintain a growth rate of 4.00 percent, forever.

If the stock currently sells for $49.70 per share, what is the required return? (Do not round intermediate calculations. Round your answer to 2 decimal places (e.g., 32.16).)

Required:

If the stock currently sells for $49.70 per share, what is the required return? (Do not round intermediate calculations. Round your answer to 2 decimal places (e.g., 32.16).)

Explanation / Answer

Answer:=

49.70 = 3.05 / (Ke - 0.04)

Therefore, ke= 10.14 %

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