Q893
Constant growth rate is 8% and an expected dividend yield is 5.4% then expected rate of return would be
A.
-3.40%
B.
3.40%
C.
13.40%
AnswerD.
-13.40%
Answer: Option C
Solution
Answer: Option C
Solution:
Expected rate of return = Constant growth rate + Expected dividend yield = 8% + 5.4% = 13.40%.