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4. Calculate today's stock price for RAD if last period's dividend was $1.38 and its dividend growth forever is expected to be 5.8% and a
4. Calculate today's stock price for RAD if last period's dividend was $1.38 and its dividend growth forever is expected to be 5.8% and a required rate of return of 9%? (2 Points) 5. Using the above assumptions (Q4), how would you partition RAD's required rate of return... in terms of its dividend yield and capital gains growth rate? Please show the computation. (2 Points) 6. If RAD's dividend was expected to grow at 25% for the next 2 years... and then return to a constant growth rate of 5.8% thereafter, what would you model its stock price to be (again, assuming a required rate of return of 9% and DO of $1.38). (5 Points)
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