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Dividend growth rate is expected to be 20% per year for the next 3 years and zero percent afterwards. The past dividend is $1 and

Dividend growth rate is expected to be 20% per year for the next 3 years and zero percent afterwards. The past dividend is $1 and the besta of the stock is 1. The market risk premium is 8%, and the risk free rate is 2%.

What is the expected price of the stock?

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SOLUTION To calculate the expected price of the stock we can use the dividend discount model which v... blur-text-image

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