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A firm has just paid a dividend of $2.5 per share. The required rate of return is 15% per year and dividends are expected to

A firm has just paid a dividend of $2.5 per share. The required rate of return is 15% per year and dividends are expected to grow at a constant rate of 9.4%. If an analyst uses Gordon Growth model to calculate the firms intrinsic value, how much does the dividend growth assumption add to the intrinsic value estimate?

A. $16.7 B. $24.1 C. $40.8

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