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(a) ABC company has adopted a policy of increasing the annual dividend on their common stock at a constant rate of 3.75% annually. The firm
(a) ABC company has adopted a policy of increasing the annual dividend on their common stock at a constant rate of 3.75% annually. The firm is paying an annual dividend of $1.10 today. What will the dividend be five years from now? (b) What do you think is the trade-off for preferred shareholders to not having the privilege of voting rights.
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