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An analyst presents you the following pro forma that gives her forecast of earnings and dividends for the period 2024-2028. At the beginning of the

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An analyst presents you the following pro forma that gives her forecast of earnings and dividends for the period 2024-2028. At the beginning of the forecast period, 240 shares are outstanding and the book value of common shareholders' equity is $14,600. The cost of equity capital is 7% and the perpetuity growth rate is 2%. Required: (a) Determine the book value of equity and the residual earnings for 2024 - 2028. (b) Using the residual earnings (RE) model, determine the share value. [Extra] Perform a sensitivity analysis by varying the cost of equity capital and perpetuity growth rate. (c) Determine the share value using the abnormal earnings growth (AEG) model. Show the equality of the RE model and the AEG model. (d) Determine (1) the reference PEG ratio and (2) calculate the generalized PEG ratio, which does take into account the effect of the dividend in the preceding period

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