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6. A share of common stock pays annual dividends. The next dividend is expected to be $10 dollars per share and is due in exactly
6. A share of common stock pays annual dividends. The next dividend is expected to be $10 dollars per share and is due in exactly 6 months (at t = .5). Subsequent dividends are expected to grow at a rate of 10% per year (and to continue forever). The price per share is $100. Find the annual effective real rate of return for an investor who purchases this stock. The inflation rate is 5% per year
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