Harrison corporation is interested in acquiring van buren, Ask an Expert

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Harrison Corporation is interested in acquiring Van Buren Corporation. Assume that the risk-free rate of interest is 5% and the market risk premium is 5%.

Van Buren currently expects to pay a year-end dividend of $1.70 a share (D1 = $1.70). Van Buren's dividend is expected to grow at a constant rate of 4% a year, and its beta is 0.7. What is the current price of Van Buren's stock? Round your answer to the nearest cent.

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M91419898

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