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Question: Pfender Guitars has a current annual cash dividend policy of $7.00. The price of the stock is set to yield a return of 8%. What is the price of this stock today if the dividend will be paid for 11 years? (constant dividend) and the stock is sold in year 14 for $25? The investment will pay an annual cash dividend of $7.00 for 11 years then receive $25 from selling the stock at the end of year 14. The price of the stock is set to yield a return of 8%.

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