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Assume that Bon Temps earnings and dividends are expected to decline by a constant 4% per yearthat is, g = -4%. Why might someone be
Assume that Bon Temps earnings and dividends are expected to decline by a constant 4% per yearthat is, g = -4%. Why might someone be willing to buy such a stock, and at what price should it sell? What would be the dividend yield and capital gains yield in each year? Assume that the required rate of return is 16%. The dividend paid yesterday was $2.00.
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