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Consider the following three slocks: a. Stock Ais expected to provide a dividend of $11.20 a share forever. b. Stock B is expected to pay
Consider the following three slocks: a. Stock Ais expected to provide a dividend of $11.20 a share forever. b. Stock B is expected to pay a dividend of 96.20 next year. Thereafter, dividend growth is expected to be 6.00% a year forever c. Stock C is expected to pay a dividend of 54.80 next year. Thereafter, dividend growth is expected to be 22.00% a year for five years (i.c.years 2 through B) and zero thereafter, 8-1. If the market capitalization rate for each stock is 12.00%, what is the stock price for each of the stocka? (Do not round Intermediate calculations. Round your answers to 2 decimal places.) Slock Price Stack Stack B Stack c $ a-2. Which stock is the most valuable? O Stock O StockA Shock B b-1. If the market capitalization rate for each stock is 9.00%, what is the stock price for each of the stocks? (Do not round intermediate calculations. Round your answers to 2 decimal places.) Stock Price Stark A Stark B Stark b-2. Which stock is the most valuable? O Stack Stack B Stock References eBook & Resources Worksheet Difficulty: Intermediate Check my work
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