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The current risk-free rate is 4 percent and the market risk premium is 5 percent. You are trying to value ABC company and it has

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The current risk-free rate is 4 percent and the market risk premium is 5 percent. You are trying to value ABC company and it has an equity beta of 0.8. The company eamed $2,50 per share in the year that just ended. You expect the company's earnings to grow 2 percent per yeac. The company has an RoE of 10 percent. a. What is the value of the stock? Do not round intemediate calculotions. Round your answer to the nearest cent. $ b. What is the present value of the growth opportunity? Do not round intermediate calculations. Round your answer to the nearest cent. 5

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