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Melissa Cutt is thinking about buying some shares of EZLawn Equipment, at $48.74 per share. She expects the price of the stock to rise to
Melissa Cutt is thinking about buying some shares of EZLawn Equipment, at
$48.74
per share. She expects the price of the stock to rise to
$51.76
over the next
3
years. During that time she also expects to receive annual dividends of
$6.84
per share.
a. What is the intrinsic worth of this stock, given a required rate of return of
9%?
b. What is its expected return?
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