posted by Teresa
General Cereal common stock dividends was $0.79 in 2000 and the last dividend paid was $1.55 per share in 2010. Dividends are expected to continue growing at the historic rate for the foreseeable future.
What is the General Cereal’s current value of a share of this stock to an investor who requires a 12 percent rate of return ?(5)
What is the current share price of General Cereal?
However, it's highly unlikely that it will provide a 12% annual return.
MS. SUE, THE CURRENT SHARE PRICE WAS NOT GIVEN!
The rate of return is based on the price the shareholder pays for the stock.
Please check with your teacher to see what is expected.