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Manufactured Earnings is a darling of Zambian analysts. Its current market price is K15 per share, and its book value is K5 per share. Analysts

Manufactured Earnings is a darling of Zambian analysts. Its current market price is K15 per share, and its book value is K5 per share. Analysts forecast that the firms book value will grow by 10 percent per year indefinitely, and the cost of equity is 15 percent. Given these facts, what is the markets expectation of the firms long-term average ROE?

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