Problem:
Walter utilities are a dividend-paying company and are expected to pay an annual dividend of $0.85 at the end of the year. Its dividend is expected to grow at a constant rate of 9.00%p per year. If Walter's stock currently trades for $18.00 per share,
Task:
Question 1: What is the expected rate of return? Give details comprehensively and also show all workings.
A. 13.72%
B. 8.32 %
C. 9. 04%
D. 9.47%