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Problem 11-18 - Dividend Discount Model A company paid a $1.65 per-share-per-year dividend last year. It is expected to increase at an annual 8% growth
Problem 11-18 - Dividend Discount Model A company paid a $1.65 per-share-per-year dividend last year. It is expected to increase at an annual 8% growth rate to year five. After year five, the dividend will grow at 6% per year indefinitely. Suppose that the required rate of return is 10%. Do 1st Growth 2nd Growth Required Rate $1.65 8% What is the value of the stock? The value of the stock is $ 6% 10% Round your answer to the nearest two decimal places.
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