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John and Alex are two investors considering the purchase of a firm's stock expected to pay dividends of $5 next year. John requires a 10%
John and Alex are two investors considering the purchase of a firm's stock expected to pay dividends of $5 next year. John requires a 10% return and he is willing to pay $100. Alex requires a 15% return. Both investors apply the Gordon Growth Model. Which of the followings are correct? The firm is expected to grow at 4% infinitely Alex is willing to pay $50 for the stock Alex might feel more confident about the firm's projected cash flow than John All of the above
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