Expected to remain at that level for foreseeable future

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Reference no: EM131610461

ABC, Inc., common stock has a current market price of $52 per share. Dividends have been $5 a share for several years and are expected to remain at that level for the foreseeable future. Other companies of similar risk and characteristics yield 10% in the marketplace. What should you recommend concerning ABC stock?

PROVIDE SOME CALCULATIONS AND STEPS

(A) It should be purchased at $52 per share, because that is a fair price.

(B) It should be purchased at $52 per share, because it will yield 10.1%.

(D) It should not be purchased at more than $50 per share.

Reference no: EM131610461

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