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    question of perpetuity

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    If a stock is expected to pay an annual dividend of $20 forever, what is the approximate present value of the stock, given that the discount rate is 5%?

    300
    40
    400
    30

    © BrainMass Inc. brainmass.com October 9, 2019, 8:32 pm ad1c9bdddf
    https://brainmass.com/economics/macroeconomics/question-of-perpetuity-154314

    Solution Summary

    A question of perpetuity is embedded.

    $2.19