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need some help please solve will rate tolt Enterprises recently paid a dividend, D0, of $1.00. It expects to have nonconstant growth of 16% for
need some help please solve will rate
tolt Enterprises recently paid a dividend, D0, of $1.00. It expects to have nonconstant growth of 16% for 2 years followed by a constant rate of 9$4 thereater, The firn's requind reth S14\%. a. How far away is the harizon date? 1. The terminal, or horizon, date is the date when the growth rate becomes constant. This cccurs at the beginning of Year 2. 11. The terminal, or hortzon, date is the date when the growh rate becomes constant, This occurs at the end of Year 2. 17I. The terminal, or horizon, date is infinity since common stocks do not have a maturity date. IV. The terminal, or herizon, date is Year 0 since the value of a common stock is the present value of all future expected dividends at time zero. V. The terminal, or horizon, date is the date when the growth rate becomes nonconstant. This occurs at time zero. b. What is the firm's horizon, or continuing, value? Do not round intermediate calculations. Round your answer to the nearest cent. \$ c. What is the firm's intrinsic volue today, P0> Do not round intermediate calculations. Round your answer to the nesrest cent. 5 Step by Step Solution
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