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#8 You feel that Stock X will be able to grow its dividend by 12% per year for the next two years, after which time
#8
You feel that Stock X will be able to grow its dividend by 12% per year for the next two years, after which time the growth rate will drop to 5% and then stay at that rate forever. You feel that a discount rate of 7% is fair, given the company's risk. Earlier today, Stock X paid a dividend of $0.35 per share. According to your expectations, what should be Stock. X's current price? Write your answer out to the nearest penny Step by Step Solution
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