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Company X has earnings per share $ 1 0 and achieves a 1 0 % return on equity while the return on a risk -

Company X has earnings per share $

10

and achieves a

10 %

return on equity while the return on a risk

-

equivalent alternative placement is

12 % .

Estimate the company's stock price when the company distributes

50 %

of its annual earnings as a dividend.

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