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Church Inc. is presently enjoying relatively high growth because of a surge in the demand for its new product. Management expects earnings and dividends to grow at a rate of 40% for the next 4 years, after which competition will probably reduce the growth rate in earnings and dividends to zero, i.e., g = 0. The company’s most recent dividend, D0, was $2.87, and its required rate of return is 13%. What is the current price of the common stock?

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M91782087

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