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Mackie Inc is currently fairly priced, and you expect that future trading prices will reflect the fair price of the stock. The stock is currently
Mackie Inc is currently fairly priced, and you expect that future trading prices will reflect the fair price of the stock. The stock is currently trading at $26.98 per share. The stock pays annual dividends. The next dividend is due in one year. You expect next year's dividend to be $3.57 per share. Given the risk of the stock, you've estimated that its fair discount rate, E(r), is 6.1% when measured as an EAR. Determine the percentage change you expect in the stock price that you expect in the next year
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