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Consider the valuation of a share of common stock that paid a $2 dividend at the end of last year and is expected to pay
Consider the valuation of a share of common stock that paid a $2 dividend at the end of last year and is expected to pay a cash dividend every year from now to infinity. Each year the dividends are expected to grow at a rate of 10 percent. Based on an assessment of the riskiness of the common stock, the investor's required rate of return is 15 percent. What is the value of this common stock?
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