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Suppose a firm is expected to increase dividends by 5% in one year and by 8% in two years. After that, dividends will increase at
Suppose a firm is expected to increase dividends by 5% in one year and by 8% in two years. After that, dividends will increase at a rate of 10% per year indefinitely. If the last dividend was $1 and the required return is 20%, what is the price of the stock?
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