Question
A firm currently pays a dividend of $0.10 a share. The dividend is expected to grow at the rate of 16% for the next five
A firm currently pays a dividend of $0.10 a share. The dividend is expected to grow at the rate of 16% for the next five years before slowing to a constant growth rate of 5% indefinitely. If you require an 18% return on this firm's stock, what is the maximum price you would pay for it?
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Essentials Of Investments
Authors: Zvi Bodie, Alex Kane, Alan Marcus
11th Edition
1260288390, 978-1260288391
