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3. Scargh Corp. will pay a dividend of $2.98 per share at the end of year 1, and this dividend is expected to grow at
3. Scargh Corp. will pay a dividend of $2.98 per share at the end of year 1, and this dividend is expected to grow at a -4 percent annual rate for two years from that point in time (i.e. until the end of year 3), then at a +1.5 percent rate forever. What value would you place on this stock if the cost of equity is 11.13%? A) $28.09. B) $28.95. C) $29.28. D) $35.95. Answer: A I How does the final answer become $28.09? what are the steps involved? Scargh Corp. will pay a dividend of $2.98 per share at the end of year 1 , and this dividend is expected to grow at a -4 percent annual rate for two years from that point in time (i.e. until the end of year 3 ), then at a+1.5 percent rate forever. What value would you place on this stock if the cost of equity is 11.13% ? A) $28.09. B) $28.95. C) $29.28. D) $35.95. Answer: A
3. Scargh Corp. will pay a dividend of $2.98 per share at the end of year 1, and this dividend is expected to grow at a -4 percent annual rate for two years from that point in time (i.e. until the end of year 3), then at a +1.5 percent rate forever. What value would you place on this stock if the cost of equity is 11.13%? A) $28.09. B) $28.95. C) $29.28. D) $35.95. Answer: A I
How does the final answer become $28.09? what are the steps involved?
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