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Chapter 7 : Stock Valuation Exercise 1 : valuing a share of a stock ( P ) that pays a dividend and you expect to
Chapter : Stock Valuation
Exercise : valuing a share of a stock P that pays a dividend and you expect to hold it for one period assume you expect the dividend to be $ in one year not right away, but wait one year out you expect to sellreceive $ for one share of this stock in one year you have a required return of for investments of similar risk how much should you pay for this one share? You don't want to pay too much...
tableAnswer:
Exercise : valuing a share of a stock that pays a constant dividend forever assume you expect the dividend to be $ in one year not right away, but wait one year out
tablerequired rate of return is
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