9. National Warehousing just announced it is increasing its annual dividend to $
ID: 2711007 • Letter: 9
Question
9. National Warehousing just announced it is increasing its annual dividend to $1.18 next year and establishing a policy whereby the dividend will increase by 3.25 percent annually thereafter. How much will one share of this stock be worth 8 years from now if the required rate of return is 9.5 percent?9. National Warehousing just announced it is increasing its annual dividend to $1.18 next year and establishing a policy whereby the dividend will increase by 3.25 percent annually thereafter. How much will one share of this stock be worth 8 years from now if the required rate of return is 9.5 percent?
9. National Warehousing just announced it is increasing its annual dividend to $1.18 next year and establishing a policy whereby the dividend will increase by 3.25 percent annually thereafter. How much will one share of this stock be worth 8 years from now if the required rate of return is 9.5 percent?
Explanation / Answer
D1 $ 1.18 D2 $ 1.22 D3 $ 1.26 D4 $ 1.30 D5 $ 1.34 D6 $ 1.38 D7 $ 1.43 D8 $ 1.48 D9 $ 1.52 P8 $ 24.38 1.52/(9.5%-3.25%) Hence, required share price is $24.38
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.