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Friedman Steel Company will pay a dividend of $4.60 per share in the next 12 months (D2). The required rate of return (K) is 17
Friedman Steel Company will pay a dividend of $4.60 per share in the next 12 months (D2). The required rate of return (K) is 17 percent and the constant growth rate is 7 percent. (Each question is independent of the others. Round the final answers to 2 decimal places.) a. Compute Po Price of common share $ b. Assume Ke, the required rate of return, goes up to 19 percent, what will be the new value of Po? New price of common share C. Assume the growth rate (g) goes up to 9 percent, what will be the new value of Po? New price of common share d. Assume D, is $6.00, what will be the new value of Po? New price of common share $
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