What growth rate would bates inc have to provide investors

Reference no: EM131488284

Question: 1. (Common stock valuation) Bates, Inc. pays a dividend of $1 and is currently selling for $32.50. If investors require a 12 percent return on their investment from buying Bates stock, what growth rate would Bates, Inc. have to provide the investors?

2. (Common stock valuation) You intend to purchase Dorchester common stock at $50 per share, hold it for 1 year, and then sell it after a dividend of $6 is paid. How much will the stock price have to appreciate for you to satisfy your required rate of return of 15 percent?

Reference no: EM131488284

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