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Bob is interested in purchasing the ordinary shares of Commie Ltd which is currently priced at $60.38. The company paid a dividend of $2.32 last

Bob is interested in purchasing the ordinary shares of Commie Ltd which is currently priced at $60.38. The company paid a dividend of $2.32 last year and expects to grow at a constant rate of 7%.

a. What is maximum price that you would be willing to pay for this share if the required rate of return is 11%?

b. Is this a good buy? Why or Why not?

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