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Rising Company paid $4.0 in dividends per share last year. The company is expected to enjoy 3 years of super growth and the dividends will
Rising Company paid $4.0 in dividends per share last year. The company is expected to enjoy 3 years of super growth and the dividends will grow at 25% next year; 20% the year after that and 15% the year after that. After the 3 super growth years the company will return to constant growth rate of 10% forever. If the required rate of return is 20% how much is its fair value or price?
A) $43.924
B) $75.9
C) $56.25
D) None of the above
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