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A business you own pays you a dividend each year. The next dividend is arriving today for $10,000 and subsequent dividends will arrive each year
A business you own pays you a dividend each year. The next dividend is arriving today for $10,000 and subsequent dividends will arrive each year forever, growing at a rate of 2% per year. So next year's dividend will be $10,200 for example. What is the present value of the business if your opportunity cost of capital is 10%?
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