Wayne Enterprises Inc pays a regular annual dividend on its common shares which is expected to grow annually in perpetuity at the rate of 3%. Today is Dec 31 and Wayne pays its dividend on January 1 (tomorrow). Last year, the dividend was $0
75 per share. Ignoring settlement, taxes and other institutional issues, what is a fair price for the stock today if investors expect an annual return of 9%?
A) $12.88
B) $13.26
C) $13.41
D) $13.63
E) $14.03
E
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