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Bearings, Inc., is a young start-up company. No dividends will be paid on the stock over the next nine years, because the firm needs to
Bearings, Inc., is a young start-up company. No dividends will be paid on the stock over the next nine years, because the firm needs to plow back its earnings to fuel growth. The company will pay a dividend of $12 per share in 10 years and will increase the dividend by 5 percent per year thereafter. If the required return on this stock is 14 percent, what is the current share price?
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