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Please show steps to equation 5. (15 Pts) The company ABC just paid $2 dividend per share, which will grow at 15% for the next
Please show steps to equation 5. (15 Pts) The company ABC just paid $2 dividend per share, which will grow at 15% for the next three dividends. Afterwards, the dividends will level off and grow at 5% per year forever. If the investors require 7% return on similar investments, what is the price of stock today? Please show all your work (on the back for extra space). Di D2 D3 D4 = 2(1+0.15) = 2(1+0.15)2 = 2(1+0.15)3 = 3,04 (1 +0.05) = 2.645 = 3.04 -3.192 = 2:3 = 2.30 = 3.19 = 2.165
Please show steps to equation
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