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GOX is a public company that has a payout ratio of 0%, however, it is expected to pay a dividend of $3.5 per share in
GOX is a public company that has a payout ratio of 0%, however, it is expected to pay a dividend of $3.5 per share in 3 years from now, which will grow at 2% forever. The required rate of return on GOX's stock is 7%. a) What should its stock price be today? b) Assume that a year from now the CEO of GOX announces that the growth rate is revised down to 1%. What should be GOX's stock price in three years from now
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