Falafel Fineries common stock is selling for 40 a share In l
Falafel Fineries\' common stock is selling for $40 a share. In looking at the stream of dividends over the past ten years, you find out that the first dividend was $0.60 and the last dividend was $2.40 What is the stock\'s expected rate of return?
Solution
Expected rate of return = D1/P0
= 2.4/40
Expected rate of return = 6%
