How much would you expect to pay for this stock

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Reference no: EM131609564

You are considering investing in Tesla, which is in development for its new, more affordable Model III. Once in full production, sales are expected to grow quite well. The current dividend is $3, and is expected to remain constant for 5 years. At that time (Model III in full production), dividends are expected to grow consistently at 4%. If Tesla’s cost of equity is 7%, how much would you expect to pay for this stock? Select one: a. 12.3 b. 116.3 c. 86.45 d. 104.00.

Reference no: EM131609564

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