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Next year's earnings are estimated to be $4. The company plans to reinvest 20% of its earnings at 10%. If the cost of equity is

Next year's earnings are estimated to be $4. The company plans to reinvest 20% of its earnings at 10%. If the cost of equity is 7%, what is the present value of growth opportunities?

$7.07

$7.86

$6.86

$5.86

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