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Suppose the Fargo Co.s dividend grows at a 20 percent rate for the next three years. Thereafter, its growth will be at a 12 percent
Suppose the Fargo Co.s dividend grows at a 20 percent rate for the next three years. Thereafter, its growth will be at a 12 percent rate. Its beta is 1.20, risk free rate is 3% and the market expected return is 10%. Find out the cost of equity using CAPM and then calculate the value of a share of Fargo Co. The companys most recent dividend was $3
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