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Example-3 Gordon Growth Company is expected to pay a dividend of $4 next period, and dividends are expected to grow at 6% per year. The
Example-3 Gordon Growth Company is expected to pay a dividend of $4 next period, and dividends are expected to grow at 6% per year. The required return is 16%. oWhat is the current price? What is the price expected to be in year 4? What is the implied return given the change in price during the four year period? The price is assumed to grow at the same rate as the dividend:s
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