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Suppose now that stocks in the XYZ Boat Company are available. These stocks are expected to pay a dividend of $ 7 . 0 0

 Suppose now that stocks in the XYZ Boat Company are available. These stocks are expected to pay a dividend of $7.00 per share next year. Thereafter, dividend growth is expected to be 5 percent a year forever. Are these securities more valuable than those of the ABC Boat Company? Show your work. (assume 10% discount rate)
What portion of the values XYZ calculated in part (b) is attributed to the present value of growth opportunities? Assume year one earnings per share (EPS) for the XYZ Corp will be $10:00. Show your work.  

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