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Valuation of a constant growth stock

A stock is expected to pay a dividend of $0.50 at the end of the year (i.e., D1 = $0.50), and it should continue to grow at a constant rate of 7% a year.

If its required return is 13%, what is the stock's expected price 4 years from today? Round your answer to two decimal places. Do not round your intermediate calculations.

Financial Management, Finance

  • Category:- Financial Management
  • Reference No.:- M92882466

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