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Q-2: Moon Corporation's common stock just paid its annual dividend of BDT 3.6 per share. The required return on the common stock is 13%. Estimate
Q-2: Moon Corporation's common stock just paid its annual dividend of BDT 3.6 per share. The required return on the common stock is 13%. Estimate the value of the common stock under each of the following assumptions about the dividend and provide investment suggestion if the value of the stock is BDT 30 per share: a. Dividends are expected to grow at an annual rate of 0% to infinity. 1 b. Dividends are expected to grow at a constant annual rate of 5% to infinity. 2 c. Dividends are expected to grow at an annual rate of 5% for each of the next 3 years, followed by a constant annual growth rate of 4% in years 4 to infinity
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