Your research into a particular common stock reveals that the current dividend. Do for the stock is $4.00, the gr...

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business finance

Answer 1

Answer #1

Expected dividend yield for the coming year

Dividend per share in Year 1 (D1)

Dividend per share in Year 1 (D1) = Dividend per share in Year 0 (D0) x (1 + Growth rate)

= $4.00 x (1 + 0.04)

= $4.00 x 1.04

= $4.16 per share

Therefore, the Expected dividend yield for the coming year = [D1 / P0] x 100

= [$4.16 / $60.00] x 100

= 6.93%

“Hence, the Expected dividend yield for the coming year will be 6.93%”

Answer 2

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