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1. A firm has just paid a dividend of $2.5 and is expected to exhibit a growth rate of 16 percent that can continue for
1. A firm has just paid a dividend of $2.5 and is expected to exhibit a growth rate of 16 percent that can continue for only four years, after that its growth will decline linearly for four years to reach the steady state 4 percent growth rate. If the appropriate discount rate is 12 percent, what is the intrinsic value of the stock? (solve in excel)
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