Question
SlowGrowth Corporation currently pays a dividend of $6 per year. Stock analysts expect the company would continue to pay the current dividend amount for two
SlowGrowth Corporation currently pays a dividend of $6 per year. Stock analysts expect the company would continue to pay the current dividend amount for two years and, after the two years, increase dividend by 1% per year in perpetuity. According to the stock analysts forecast of future dividends, what should be the stock price today if the discount rate is 6%?
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Fundamentals of Investments Valuation and Management
Authors: Bradford Jordan, Thomas Miller
7th edition
978-0078096785, 78096782, 978-0077861636, 77861639, 978-0078115660
