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Investors require a 7% rate of return on Mather Company's stock (i.e., rs = 7%). a. What is its value if the previous dividend
Investors require a 7% rate of return on Mather Company's stock (i.e., rs = 7%). a. What is its value if the previous dividend was Do $3.25 and investors expect dividends to grow at a constant annual rate of (1) -3%, (2) 0 %, (3) 3 %, or (4) 5%? Do not round intermediate calculations. Round your answers to the nearest cent. (1)$ (2)$ (3) $ (4) $ b. Using data from part a, what would the Gordon (constant growth) model value be if the required rate of return was 8% and the expected growth rate was (1) 8% or (2) 12 %? Round your answers to the nearest cent. If the value is undefined, enter N/A. (1) $ (2) $
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