Over the past 6 years, Elk County Telephone has paid the dividends shown in the following...
Over the past 6 years, Elk County Telephone has paid the dividends shown in the following table,
|
Year |
Dividend per share |
|
|
20192019 |
$3.653.65 |
|
|
20182018 |
$3.513.51 |
|
|
20172017 |
$3.373.37 |
|
|
20162016 |
$3.243.24 |
|
|
20152015 |
$3.123.12 |
|
|
20142014 |
$3.00 |
. The firm's dividend per share in 2020 is expected to be $3.80.
a. If you can earn 13% on similar-risk investments, what is the most you would be willing to pay per share in 2019, just after the $3.65
dividend?
b. If you can earn only 10% on similar-risk investments, what is the most you would be willing to pay per share?
c. Compare your findings in parts a and b, what is the impact of changing risk on share value?
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is the most you would be willing to pay per...
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