Q876
Constant growth rate is 7.2% and an expected rate of return is 12.5% then expected dividend yield will be
A.
5.30%
AnswerB.
19.70%
C.
-5.30%
D.
17.36%
Answer: Option A
Solution
Answer: Option A
Solution:
Expected dividend yield = Expected rate of return - Constant growth rate = 12.5% - 7.2% = 5.30%