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Problem:

ABC common stock is expected to have extraordinary growth of 20% per year for 2 years, at which time the growth rate will settle into a constant 5%.

Required:

Question: If the discount rate is 16% and the most recent dividend was $3.00, what should be the approximate current share price?

Note: Provide support for rationale.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M91166829

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