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9. Nell Corporation stock is currently selling for $15.50. The stock is expected to pay a...

9. Nell Corporation stock is currently selling for $15.50. The stock is expected to pay a dividend of $1.75 at the end of the year. Dividends are expected to grow at a constant rate of 6% indefinitely. Compute the expected rate of return on Nell Corporation stock. Submit your answer as a percentage and round to two decimal places.

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Answer #1

Expected return=(D1/current price)+growth rate

=(1.75/15.50)+0.06

Which is equal to

=17.29%(approx).

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