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A. Suppose the dividend of a stock grows at a constant rate. The required return rate for investment on the stock is 5% annually. The
A. Suppose the dividend of a stock grows at a constant rate. The required return rate for investment on the stock is 5% annually. The present value of the stock is $1,000/share now and it is expected to be $1,031 in a year. The dividend to be paid at the end of the second year will be $____/share.
B. The expected return rate of a stock is 7.4% annually. Its current price is $63.9/share. It is expected to deliver a dividend of $6/share in a year. Find the expected price of the stock in a year.
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