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A Common Share Pays an Annual Dividend Per Share of $1.80

Question 52

Multiple Choice

A common share pays an annual dividend per share of $1.80. The risk-free rate is 5 per cent and the risk premium for this share is 4 per cent. If the annual dividend is expected to remain at $1.80 per share, what is the value of the share?


A) $17.78
B) $20.00
C) $40.00
D) None of the above

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