Bruer, Inc., is expected to maintain a constant 6.10 percent growth rate in its

Question

Bruer, Inc., is expected to maintain a constant 6.10 percent growth rate in its dividends, indefinitely.

If the company has a dividend yield of 4.60 percent, what is the required return on the company%u2019s stock? (Do not include the percent sign (%). Round your answer to 2 decimal places (e.g., 32.161).)

If the company has a dividend yield of 4.60 percent, what is the required return on the company%u2019s stock? (Do not include the percent sign (%). Round your answer to 2 decimal places (e.g., 32.161).)

Explanation / Answer

Hi,

Please find the answer as follows;

Required Return = Dividend Yield + Growth = 6.10 + 4.60 = 10.70%

Thanks

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