The market rate of return on similar securities is 175


An investor wants to purchase shares in a firm that has no growth opportunities but pays an annual dividend of $2.35. The market rate of return on similar securities is 17.5 percent. What is the maximum price the investor should pay for this stock?

Solution Preview :

Prepared by a verified Expert
Finance Basics: The market rate of return on similar securities is 175
Reference No:- TGS02745460

Now Priced at $10 (50% Discount)

Recommended (98%)

Rated (4.3/5)