Management expects to reduce the payout

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Reference no: EM132074169

1. Teder Corporation stock currently sells for $100 per share. The market requires a 13 percent return on the firm's stock.

Required :

If the company maintains a constant 6 percent growth rate in dividends, what was the most recent dividend per share paid on the stock?

$8.87

$6.60

$6.34

$19.06

$7.00

2. Antiques R Us is a mature manufacturing firm. The company just paid a $15 dividend, but management expects to reduce the payout by 10 percent per year indefinitely.

Required :

If you require an 16 percent return on this stock, what will you pay for a share today?

$51.92

$225.00

$57.69

$51.40

$52.44

Reference no: EM132074169

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