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Royal Hills Corporation pays 30% of its earnings to stockholders and retains 70% to finance growth. The firm recently paid a $3.20 common stock dividend.

Royal Hills Corporation pays 30% of its earnings to stockholders and retains 70% to finance growth. The firm recently paid a $3.20 common stock dividend. Investors require a return of 14% on Royal Hills common stock. If the firm earns a return on equity of 10%, what should be the value of Royal Hills common stock?

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