Question
A firm expects to pay dividends at the end of each of the next four years of $2.00, $1.50, $2.50, and $3.50. You require a
A firm expects to pay dividends at the end of each of the next four years of $2.00, $1.50, $2.50, and $3.50. You require a 14% rate of return during these four years. If growth is then expected to level off at 8 percent, expected rate of return drops to 10%.
How much should you be willing to pay for this stock?
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Present Value of Dividends 200 1 014 150 1 0142 250 1 0143 350 1 ...
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Financial Management for Public Health and Not for Profit Organizations
Authors: Steven A. Finkler, Thad Calabrese
4th edition
133060411, 132805669, 9780133060416, 978-0132805667
