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Shatin Intl. has 110 million shares, an equity cost of capital 12%, and is expected to pay a total dividend of $25 million each year
Shatin Intl. has 110 million shares, an equity cost of capital 12%, and is expected to pay a total dividend of $25 million each year forever. It announces that it will increase its payout to shareholders. Instead of increasing its dividend, it will keep it constant and will start repurchasing $10 million of stock each year as well. How much will its stock price increase?
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