The next dividend payment by Hot Wings, Inc., will be $4.75 per share. The dividends are anticipated to maintain a 4 percent growth rate forever.
Required:
If the stock currently sells for $54 per share, what is the required return?
12.16%
12.80%
8.80%
12.54%
4.00%
2. Metroplex Corporation will pay a $5.80 per share dividend next year. The company pledges to increase its dividend by 6.20 percent per year indefinitely.
Required:
If you require an 9.80 percent return on your investment, how much will you pay for the company's stock today?
$154.67
$151.71
$167.56
$34.13
$161.11