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Suppose a stock pays a $2 dividend at the end of the year = D today (1+g), the required return (the interest rate i )
Suppose a stock pays a $2 dividend at the end of the year = Dtoday(1+g), the required return (the interest rate i ) = 8% and the growth rate i= 6%
What should be the price using the above model?
a. $50
b. $100
c. $75
d. $25
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