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ABC Company has recently paid a dividend of k 1 0 0 . The company quoted a price ofk 1 2 0 0 . The
ABC Company has recently paid a dividend of k The company quoted a price ofk The dividend is expected to grow at a rate of for the next two years; at a rate of for the subsequent three years and thereafter at a rate of for unforeseeable future. Two investors are trying to reach a decision whether to consider the purchase of the stock or not. The required rates of return for the two investors are and respectively.
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