Solved by a verified expert :6 Eastern Electric currently pays a dividend of about $1.71 per share and sells for $25 a share. a. If investors believe the growth rate of dividends is 4% per year, what rate of return do they expect to earn on the stock? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) 10 b. If investors required rate of return is 10%, what must be the growth rate they e calculations. Enter your answer as a percent rounded to 2 decimal places.) expect of the firm? (Do not round intermediate c. If the sustainable growth rate is 5% and the plowback ratio is 0.5, what must be the rate or return earned by the firm on its new investments? (Enter your answer as a percent rounded to 2 decimal places.) < Prev6 of 20 Next > 20B 6
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