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show the calculations for 4, 5 Management expects dividends to grow at 20% for the next 4 years, after which the growth rate in dividends
show the calculations for 4, 5
Management expects dividends to grow at 20% for the next 4 years, after which the growth rate in dividends is 2%, i.e., g=2%, The company's last dividend, D0=$1.5, and its return is 10%. The current price of the common stock equals? (Hint: calculate P4 the price at year 4 using g=0 in DCF, and then using NPV(rate, D 1,D2,D3,D4+P4 )(or use the non-constant growht diidend model calculator at https://www.jufinance.com/dcfl ) $30.92 $35.09 $39.56 $34.58 QUESTION 5 XYZ stock's required rate of return is 10%, and Po is $50 /share. The dividend is expected to grow at a constant rate of 6%. Calculate the last dividend D 1 $2.23 $2.44 $2.0 $2.83Step by Step Solution
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