Ask Question
12 May, 08:32

3) Leslie's Unique Clothing Stores offers a common stock that pays an annual dividend of $2.60 a share. The company has promised to maintain a constant dividend. How much are you willing to pay for one share of this stock if you want to earn a return of 13.80 percent on your equity investments?2PTS

+1
Answers (1)
  1. 12 May, 09:44
    0
    D = $2.60

    Ke = 13.80% = 0.1380

    Po = D/Ke

    Po = $2.60/0.1380

    Po = $18.84

    Explanation:

    In this question, there is need to divide the current dividend paid by cost of equity in order to obtain the current market price of equity.
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “3) Leslie's Unique Clothing Stores offers a common stock that pays an annual dividend of $2.60 a share. The company has promised to ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers