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Question 5, P7-13 (simila... HW Score: 35%, 14 of 40 points O Points: 0 of 9 Save Common stock value Variable growth Newman Manufacturing is

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Question 5, P7-13 (simila... HW Score: 35%, 14 of 40 points O Points: 0 of 9 Save Common stock value Variable growth Newman Manufacturing is considering a cash purchase of the stock of Grips Tool. During the year just completed, Grips earned $2.91 per share and paid cash dividends of $1.21 per share (0,= $1.21). Grips' earnings and dividends are expected to grow at 25% per year for the next 3 years, after which they are expected to grow 6% per year to infinity What is the maximum price per share that Newman should pay for Grips if it has a required return of 15% on investments with risk characteristics similar to those of Grips? The maximum price per share that Newman should pay for Grips is $(Round to the nearest cent.) Clear All Check

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