Respuesta :
Answer:
The amount of the last annual dividend paid is $4.3.
Explanation:
Given:
The common stock of Zeta Group sells for $42 per share, has a rate of return of 12.2 percent, and a dividend growth rate of 1.8 percent annually.
Now, to find the amount of last annual dividend paid.
Let the amount of last annual dividend paid be [tex]l.[/tex]
Price of per share ([tex]p[/tex]) = [tex]\$42.[/tex]
Rate of return ([tex]r[/tex]) = [tex]12.2\%.[/tex]
Rate of dividend growth ([tex]g[/tex]) = [tex]1.8\%.[/tex]
Now, to get the amount of last dividend paid we put formula:
[tex]p=\frac{l(1+g)}{r-g}[/tex]
[tex]42=\frac{l(1+1.8\%)}{12.2\%-1.8\%}[/tex]
[tex]42=\frac{l(1+0.018)}{0.122-0.018}[/tex]
[tex]42=\frac{l\times 1.018}{0.104}[/tex]
Multiplying both sides by 0.104 we get:
[tex]4.368=1.018l[/tex]
Dividing both sides by 1.018 we get:
[tex]4.3=l[/tex]
[tex]l=\$4.3.[/tex]
Therefore, the amount of the last annual dividend paid is $4.3.
