Explore BrainMass

Explore BrainMass

    Calculating C0ommon stock price

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    A share of common stock has just paid a dividend of $2. If the expected long-run growth rate for this stock is 5%, and if investors required rate of return is 10.5%, what is the stock price?

    a. $35.39
    b. $38.80
    c. $37.23
    d. $38.18
    e. $39.14

    © BrainMass Inc. brainmass.com June 4, 2020, 12:23 am ad1c9bdddf
    https://brainmass.com/business/accounting/calculating-common-stock-price-335504

    Solution Preview

    Use the discounted dividend model for growth stocks, here you need ...

    Solution Summary

    This solution goes through how to calculate common stock price.

    $2.19

    ADVERTISEMENT