Stock XYZ has a current dividend of $6.00. The dividend is expected to grow at 4.00% per year until year 3 and then at 3.00% per year for the rest of time. Based on the riskiness XYZ, its discount rate is 7.00%. With this information, what is the dividend yield from today to year 1?
(A) 7.00%
(B) 3.73%
(C) 4.00%
(D) 4.12%
(E) 3.93%
(F) 3.07%
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Home » Business » Stock XYZ has a current dividend of $6.00. The dividend is expected to grow at 4.00% per year until year 3 and then at 3.00% per year for the rest of time. Based on the riskiness XYZ, its discount rate is 7.00%.