13. Constant-Growth Model. Gentleman Gym just paid its annual dividend of $3 per share, and it is...

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13. Constant-Growth Model. Gentleman Gym just paid its annual dividend of $3 per share, and it is widely expected that the dividend will increase by 5% per year indefinitely. (LO2)

a. What price should the stock sell at? The discount rate is 15%.

b. How would your answer change if the discount rate were only 12%? Why does the answer change?

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Fundamentals Of Corporate Finance

ISBN: 9780073382302

6th Edition

Authors: Richard A Brealey, Stewart C Myers, Alan J Marcus

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Question Posted: Jul 31, 2024 11:01 AM

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13. Constant-Growth Model. Gentleman Gym just paid its annual dividend of $3 per share, and it is...

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Fundamentals Of Corporate Finance

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