8. Hudson Corporation will pay a dividend of $2.60 per share next year. The company...
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8. Hudson Corporation will pay a dividend of $2.60 per share next year. The company pledges to increase its dividend by 4.30 percent per year indefinitely.
If you require a return of 9.60 percent on your investment, how much will you pay for the company's stock today?
A. $47.09
B. $49.06
C. $17,93
D. $51.02
E. 47.03
9. Suppose you know a company's stock currently sells for $80 per share and the required return on the stock is 10 percent. You also know that the total return on the stock is evenly divided between a capital gains yield and a dividend yield.
If it's the company's policy to always maintain a constant growth rate in its dividends, what is the current dividend per share?
A.$3.62
B. $7.62
C. $4.05
D. $3.81
E. $4.00
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