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Suppose a firm's stock is selling for $15. It just paid a $1.50 dividend, and dividends are expected to grow at 7% per year.

 

Suppose a firm's stock is selling for $15. It just paid a $1.50 dividend, and dividends are expected to grow at 7% per year. What is the required return (R)? You can use the following formula: Po R = Do (1+g) R-g D, (1 + g) Po D R-g + g = D Po + g

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