Under the efficient markets hypothesis, what would be the price per share of a company whose current dividend is $10.00 and whose dividends are expected to grow by 3% per year (assume the risk-adjusted interest rate is 10%)?
A) $74.62
B) $79.23
C) $142.86
D) $147.14
D
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Here is an excerpt form an editorial praising capitalism in The Economist:“It is competition that delivers choice, holds prices down, encourages invention and service, and (through all these things) delivers economic growth.” To what type of competition does the writer refer? Is it the sort of competition that economists study? Explain.
What will be an ideal response?
A tax of 10 units on the seller can be shown graphically as a
A. rightward shift of demand. B. leftward shift of supply. C. leftward shift of demand. D. rightward shift of supply.
Advocates of activist policymaking point to the swift response of the Fed after September 11, 2001, as an example of effective policymaking.
Answer the following statement true (T) or false (F)
The target rate of unemployment is defined as the:
A. lowest sustainable rate of unemployment achievable under existing conditions. B. lowest rate of unemployment that will eliminate the business cycle. C. highest sustainable rate of unemployment achievable under existing conditions. D. highest unemployment rate at which there is no cyclical or structural unemployment.