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Return on Portfolio A Return on Portfolio B 5% 2% 8% 3% 10% 6% 4% 2.5% 6% 10% Suppose a common stockholder receives a dividend
Return on Portfolio A | Return on Portfolio B |
5% | 2% |
8% | 3% |
10% | 6% |
4% | 2.5% |
6% | 10% |
Suppose a common stockholder receives a dividend of $1.75, which is expected to grow at a constant rate of 2% for the next 6 years, what will be the present value of the stock if the expected market rate of return is 6%?
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