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A stock is paying a quarterly dividend of $10 in 1 month. The dividend is expected to increase every quarter by the inflation rate of

image text in transcribed A stock is paying a quarterly dividend of $10 in 1 month. The dividend is expected to increase every quarter by the inflation rate of 1% per quarter - so it will be $10.10 in the next quarter (i.e., paid out in 4 months). The prevailing cost of capital for this kind of stock is 18% per annum. What should this stock be worth

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