Rate of return on the security

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Heleveton, Inc. currently pays a common stock dividend of $2.00 per share (D0). Dividends are expected to increase by $0.50 per share next year. Determine the current value of Heleveton's common stock to an investor who expects to be able to sell the stock for $32 after one year. Assume that the investor requires a 12% rate of return on the security.

  • $30.36
  • $30.80
  • $20.83
  • $33.05

Reference no: EM131596954

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