What price investor be expected to pay per share


A stock is expected to pay $1.25 per share every year indefinitely and the equity cost of capital for the company is 7.5%. What price would an investor be expected to pay per share today?

A) $16.67
B) $41.68
C) $33.34
D) $25.01

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Finance Basics: What price investor be expected to pay per share
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