McDonnell Manufacturing is expected to pay a dividend of $1.50 per share at the end of the year (D1 = $1.50). The stock sells for $34.50 per share, and its required rate of return is 11.5%. The dividend is expected to grow at some constant rate, g, forever. What is the equilibrium expected growth rate?© BrainMass Inc. brainmass.com September 20, 2018, 10:41 am ad1c9bdddf - https://brainmass.com/business/finance/equilibrium-expected-growth-rate-309139
Stock price = Dividend / (Required rate of return - dividend ...
The solution computes Equilibrium Expected growth rate.