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A company paid a dividend of $1.00 last year. The dividend is expected to grow at a rate of 10% next year, then 15%. Afterwards
A company paid a dividend of $1.00 last year. The dividend is expected to grow at a rate of 10% next year, then 15%. Afterwards it will grow at a constant rate of 6%. Assume that the investor wants to get a return of 12% on the stock. What is the firms stock worth today? SHOW ALL WORK A) draw timeline B)calculate future dividends C) determine future value of stock once it reaches constant growth rate. D)discount & add relevant discounted value to determine the price of the stock today.
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