Find the apparent rate of discount

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Question - In reading an article about the prospects of the Spyridon Corporation you learn that very recently Spyridon paid an annual dividend of $4.00 per share, that the analyst expects the company to increase its dividend by 4% indefinitely, and that the analyst values a share in Spyridon Corporation at $20 per share. The analyst does not disclose the discount rate applied to the stream of expected dividends. Given the information in the article, find the apparent rate of discount?

Reference no: EM133071890

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