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A stock has a current dividend of $2/share and earnings of $10/share. It pays out 20% of earnings each year. If income is expected to
A stock has a current dividend of $2/share and earnings of $10/share. It pays out 20% of earnings each year. If income is expected to grow 10%/year, what is the stock worth based on the constant growth model? The required rate of return is 12%.
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