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Suppose the risk - free rate is 3 . 5 4 % and an analyst assumes a market risk premium of 6 . 1 1

Suppose the risk-free rate is 3.54% and an analyst assumes a market risk premium of 6.11%. Firm A just paid a dividend of $1.43 per share. The analyst estimates the \beta of Firm A to be 1.26 and estimates the dividend growth rate to be 4.96% forever. Firm A has 260.00 million shares outstanding. Firm B just paid a dividend of $1.79 per share. The analyst estimates the \beta of Firm B to be 0.85 and believes that dividends will grow at 2.54% forever. Firm B has 192.00 million shares outstanding. What is the value of Firm A?

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