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Metatrend's stock will generate earnings of $5/share this year. The discount rate for the stock is 15% and the rate of return on reinvested earnings is also 15%. a) find both the growth rate of dividends and the price of the stock if the company reinvests the following fraction of its earnings in the firm (1) 0 % (2) 40% (3) 60%.

Microeconomics, Economics

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