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Question: The ABC stock is currently selling at a price of Market investors have determined that based on its risk return tradeoff, the required return is The firm carries an expected rate of return in the amount of The firm recently paid a dividend in the amount of The earnings have been growing at a constant rate of Your uncle says that the stock is a not a great deal and is overvalued @$198 a share. Prove that he is right or wrong by finding the fair market value of the stock today. What is the present price of the stock today and was your uncle correct in his assertion?

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Basic Finance, Finance

Category:- Basic Finance
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