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Assume that a company paid a dividend of $ 0 . 7 0 in 2 0 2 3 . Dividends are expected to grow annually
Assume that a company paid a dividend of $ in Dividends are expected to grow annually by for the next four years to From dividends will grow at a constant rate of per year.
If the cost of equity is and the market value of the company share was $ after paying the dividend in :
a Build a dividend growth model that captures both high growth and constant growth.
b Should you buy the company share? Explain your answer.
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