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7. Camilla bought a stock 1 year ago with an expected cash dividend of $0.36 per share for the year. She can sell the stock
7. Camilla bought a stock 1 year ago with an expected cash dividend of $0.36 per share for the year. She can sell the stock today for a price of $14 and realize a return of 30%. At what price did Camilla buy the stock 1 year ago? Hint: use 2 decimal places for your calculations.) A. $13.10. B. $17.94. C. $11.04. D. $19.29. E. None of the above. 8. Consider a company that is not currently paying dividends. You predict that in five years, the company will pay a dividend for the first time. The dividend will be $0.50 per share. You expect this dividend to grow at 10 percent indefinitely. The required return on companies such as this one is 20 percent. What is the price of the stock today? A. $3.25. B. $2.41. C. $4.36. D. $5.19. E. None of the above
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