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You own 1,100 shares of stock in Avondale Corporation. You will receive a $2.60 per share dividend in one year. In two years, Avondale will pay a liquidating dividend of $75 per share. The required return on Avondale stock is 20 percent. Suppose you want only $2,000 total in dividends the first year.

What will your homemade dividend be in two years?

Financial Management, Finance

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