Will-o-wind airlines always invests in non-depreciating, Ask an Expert

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Will-O-Wind Airlines always invests (in non-depreciating assets) 20% of its earnings, which will be next period (Period 1) $3 per share. The rest it pays out as dividends. Its investment opportunities currently earn (and are expected to earn in the indefinite future) 18%. There are no taxes. The risk adjusted required rate of return on this stock is 10%. What is its price?

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Financial Management, Finance

Category:- Financial Management
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