Gold Coast Health System just paid an annual dividend of $1.50, which is expected to grow at a constant rate of 5 percent per year. If the current required rate of return is 15 percent, what is the value of Gold Coast’s stock?
A) $15.75
B) $15.50
C) $15.25
D) $15.00
E) $14.75

Explanation: In this question, there is need to calculate the value of the company's stock on the ground that dividend has been paid. The value of the stock is a function of current divided paid, growth rate and the required rate of return on the stock.

Gold Coast Health System just paid an annual dividend of $1.50, which is expected to grow at a constant rate of 5 percent per year. If the current required rate of return is 15 percent, what is the value of Gold Coast’s stock? A) $15.75 B) $15.50 C) $15.25 D) $15.00 E) $14.75

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Gold Coast Health System just paid an annual dividend of $1.50, which is expected to grow at a constant rate of 5 percent per year. If the current required rate of return is 15 percent, what is the value of Gold Coast’s stock?
A) $15.75
B) $15.50
C) $15.25
D) $15.00
E) $14.75