Question

Tookies Tacos’ next annual dividend will be $4.26 a share and all later dividends are expected to increase by 4.4 percent annually. What is the rate of return if this stock is currently selling for $48.74 a share?

Answer 1

The rate of return if this stock is currently selling for $48.74 a share is 13.14%.

Rate of return

Using this formula

Rate of return=(Annual dividend/Stock current price)+Expected rate

Let plug in the formula

Rate of return= ($4.26/$48.74) + .044

Rate of return=0.0874+0.044

Rate of return=0.1314×100

Rate of return=13.14%

Inconclusion the rate of return if this stock is currently selling for $48.74 a share is 13.14%.

Learn more about rate of return here:https://brainly.com/question/24301559