A company will pay 2 dividends next year. these dividends, Ask an Expert

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A company will pay $2 dividends next year. These dividends are expected to grow at a rate of 15% for four years. Afterwards, the long term growth rate is expected to settle at 4%. The published beta for the stock is 1.2, the expected rate of return on the market is 13% and the current risk free rate is 3%.

a. find out the company's dividends to from year 1 to year 5?

b. MVI's beta is 1.6, the expected return on the market is currently 12.75 percent, and the risk free rate is 4%? What should be the company's required return?

c. find out the company's stock price at the end of year 4 as the constant growth period begins.

d. find out the company's stock price today.

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Basic Finance, Finance

Category:- Basic Finance
Reference No.:- M953334

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