Brickhouse is expected to pay a dividend of $2. 50 and $2. 20 over the next two years, respectively. After that, the company is expected to increase its annual dividend at 2. 6 percent. What is the stock price today if the required return is 10 percent?.

Respuesta :

The company increases its dividends by 1.65 percent annually.

In exchange for regular interest payments, a bondholder loans money to a business or the government for a predetermined length of time. As soon as the bond matures.

What features distinguish a bond?

  • Bonds can be identified by their maturity, coupon (interest) rate, tax status, and callability, among other attributes. Bonds are subject to a number of hazards, including interest rate risk, credit/default risk, and prepayment risk. The majority of bonds have ratings that indicate their investment grade.
  • These investment-grade bonds have the highest quality and are thought to have the lowest default rates. Typically, investment-grade bonds of the highest caliber are regarded as U.S. Treasury bonds.
  • Corporate bonds, municipal bonds, government bonds, and agency bonds are the four different types of bonds that can be categorized.
  • In exchange for regular interest payments, a bondholder loans money to a business or the government for a predetermined length of time. As soon as the bond matures.

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