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Metallica Bearings, Inc., is a young start-up company. No dividends will be paid on the stock over the next nine years, because the firm needs to plow back its earnings to fuel growth. The company will then pay a dividend of $15.75 per share 10 years from today and will increase the dividend by 5.00 percent per year there after.

Required:

If the required return on this stock is 13.00 percent, what is the current share price?

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M9995620

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