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Suppose a company is expected to pay a dividend of $5 next year. The dividend is...

Suppose a company is expected to pay a dividend of $5 next year. The dividend is expected to grow at 3.75% each year. If the stock is currently selling for $47.86, what is the dividend yield?

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Answer #1

Dividend yield = dividend in 1 year/current price = 5/47.86

=10.45%

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