AN INVESTOR GATHERS THE FOLLOWING INFORMATION ABOUT A COMPANY

79. - MOCK AND SAMPLE EXAMS CFA LEVEL I MOCK EXAM AFTERNOON VERSIONB QUESTIONS 2014 79. - MOCK AND SAMPLE EXAMS CFA LEVEL I MOCK EXAM AFTERNOON VERSIONB QUESTIONS 2014
MOCK AND SAMPLE EXAMS CFA LEVEL I MOCK EXAM AFTERNOON VERSIONB QUESTIONS 2014

79. An investor gathers the following information about a company:

Current earnings per share $5.00

Current dividend per share $3.00

Required rate of return 15.0%

Return on equity (ROE) 17.5%

Using the dividend discount model, the value of the company's stock is closest to:

A. $73.67.

B. $40.13.

C. $37.50.

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