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Assume NetWonders is operating in a new industry that has recently caught on with the public. The latest annual dividend D0, paid yesterday, was $1. Due to high growth in sales, a 25% growth rate in cash dividends is expected over the next two years. Thereafter, the growth rate is expected to be 5% forever. The required rate of return on the stock is 22%. What is a share of NetWonders common stock worth?

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92059253

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