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The Birmingham Basketball Company earned $15 per share last year and just paid a $10.5 dividend per share. You expect the company to earn $16
The Birmingham Basketball Company earned $15 per share last year and just paid a $10.5 dividend per share. You expect the company to earn $16 per share next year and to maintain the same dividend payout ratio. Assume that you expect to sell the stock for $152 in one year. If you require a 12% return on the stock, how much would you be willing to pay for it? Show your calculations.
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