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A; The required rate of return of a firm's stock is 6.8%. The firm decides to reinvest 30% of the earnings every year. The dividend

A; The required rate of return of a firm's stock is 6.8%. The firm decides to reinvest 30% of the earnings every year. The dividend to be delivered in a year will be $3.5/share. The present value of growth opportunity for the firm's stock is $________.

B; The required return rate of a stock is 9%. Its growth rate is 3.1%. Its dividend at the end of the current period is $4.2. Please find the PVGO of the stock.

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