2. 15. Non-constant Growth [LO 8.1] Clackline Bearings Limited is a young startup company. No dividends will

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2. 15.

Non-constant Growth [LO 8.1] Clackline Bearings Limited is a young startup company. No dividends will be paid on the shares over the next nine years because the firm needs to plough back its earnings to fuel growth. The company will pay a dividend of $17 per share 10 years from today and will increase the dividend by 3.9 per cent per year thereafter. If the required return on the shares is 12.5 per cent, what is the current share price?

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