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Bandor Furniture pays a constant annual dividend. Last year, the dividend yield was 4.9 percent when the stock was selling for $43.50 per share. What is the current price of the stock if the current dividend yield is 4 percent

Respuesta :

Tundexi

The current price of the stock is $53.29.

  • The formula for the Dividend yield is {Dividend / selling price of stock}

0.049 = Dividend / $43.50

Dividend = $43.50 * 0.049

Dividend = $2.1315

  • The formula for Current Dividend yield is {Dividend / Current stock price}

0.04 = $2.1315 / Current stock price

Current stock price =  $2.1315 / 0.04

Current stock price = $53.2875

Current stock price = $53.29

Therefore, the current price of the stock is $53.29.

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