What is the maximum amount you are willing to pay

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Problem - The Boat will pay its annual dividends of $2.62 a share next year. The company now predicts that it will maintain a constant dividend since its sales are expected to remain the same in the future. If you require a 12 percent rate of return, what is the maximum amount you are willing to pay for one share of this stock today?

1) $21.83

2) $23.86

3) $25.74

4) $27.31

5) $29.45

Reference no: EM132462803

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