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Computer stocks currently provide an expected rate of return of 23%.MBI, a large computer company, will pay a year-end dividend of $3.40 per share. Required:
Computer stocks currently provide an expected rate of return of 23%.MBI, a large computer company, will pay a year-end dividend of $3.40 per share. Required: a. If the stock is selling at $64 per share, what must be the market's expectation of the dividend growth rate? Note: Round your answer to 2 decimal places. b. If dividend growth forecasts for MBI are revised downward to 10% per year, what will happen to the price of MBI stock? c. What (qualitatively) will happen to the company's price-earnings ratio
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