Final answer:
To calculate the price of Zion Company's stock, use the dividend yield formula. The stock price is found to be $130 per share based on the provided dividend yield of 4% and dividends of $5.20 per share.
Step-by-step explanation:
The student's question is about calculating the price of a stock based on its dividend yield. The dividend yield is given by the equation Dividend Yield = (Dividends per Share / Price per Share) * 100%. To find the price per share, we can rearrange this to Price per Share = Dividends per Share / (Dividend Yield / 100%).
Given that Zion Company has a dividend yield of 4% and paid dividends of $5.20 per share, the calculation is as follows:
Price per Share = $5.20 / (4 / 100) = $5.20 / 0.04 = $130.
Therefore, the price of Zion Company's stock is $130 per share.