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please show works on Excel. Thank you in advance! 3. Consider the following three energy stocks: a. Stock A is expected to provide a dividend
please show works on Excel. Thank you in advance!
3. Consider the following three energy stocks: a. Stock A is expected to provide a dividend of $15 a share forever. b. Stock B is expected to pay a dividend of $7 next year. Thereafter, dividend growth is expected to be 5% a year forever. c. Stock C is expected to pay a dividend of $7 next year. Thereafter, dividend growth is expected to be 12% a year for five years (i.e. until year 6) and zero thereafter. If the discount rate for each stock is 10%, which stock is the most valuable today? What if the discount rate is 5% Step by Step Solution
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