An issue of common stock currently sells for $52 per share, has an expected annual dividend to be paid at the end of the year of $0.90 per share, and has an expected growth rate to infinity of 5% per year. The expected rate of return on this security is:

6.73%

Explanation:

The expected rate of return will be calculated by using the formula:

Po= D1 / ( Ke – g )

Where,

Po = Current Price of the stock = $52

D1 = Expected dividend = $0.90

Ke = Expected rate of Return

g = Expected growth rate = 5% = 0.05

We'll then slot in the values into the equation. Therefore,

52.00 = 0.90 / (Ke – 0.05 )

(Ke – 0.05 ) = 0.90 / 52.00

(Ke – 0.05 ) = 0.01731

Ke = 0.05 + 0.01731

Ke = 0.06731

Ke = 6.73%

Therefore, the expected rate of return on this security is 6.73%.

i would have to say its c

you will have $2593.74 in 10 years if you set aside $1,000 at 10%

you will have $9321.91 in 20 years if you set aside $2000 at 8%

you will have $1469.32 in 5 years if you set aside $1000 at 8%

you will have $1296.87 in 10 years if you set aside $500 at 10%

you will have $239.66 in 15 years if you set aside $100 at 6%

you will have $4660.96 in 20 years if you set aside $1000 at 8%