Question

Martell Mining Company's ore reserves are being depleted, so its sales are falling. Also, its pit is getting deeper each year, so its costs are rising. As a result, the company's earnings and dividends are declining at the constant rate of 3% per year. If D0 = $2 and rs = 16%, what is the value of Martell Mining's stock? Round your answer to two decimal places.

Answer 1

$23.75