you expected k street co's trade at $100 per share right after paying a $2 dividend per share in one year

Finance Aug 07, 2020

you expected k street co's trade at $100 per share right after paying a $2 dividend per share in one year. What is the most you would pay to buy the stock now if you want to earn at least a 15% return?

Expert Solution

Answer : $ 86.96

Future value of the share in one year = $ 100

Present value of the share = $ 100 / 1.15 = $ 86.956

Archived Solution

Unlocked Solution

You have full access to this solution. To save a copy with all formatting and attachments, use the button below.

Already a member? Sign In

Important Note: This solution is from our archive and has been purchased by others. Submitting it as-is may trigger plagiarism detection. Use it for reference only.

For ready-to-submit work, please order a fresh solution below.

Or get 100% fresh solution

Get Custom Quote