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The economy wide real risk free interest rate is 3.0%, the inflation premium is 1.5%, and the market risk premium is 8.5%. At the same

The economy wide real risk free interest rate is 3.0%, the inflation premium is 1.5%, and the market risk premium is 8.5%. At the same time, the Company's beta is 0.75, its dividend growth rate is 3.5%, and it just paid a dividend of $1.65 per share. The company anticipates a change in production plan that should affect its beta and dividend growth rate. The new beta becomes 0.70 and the growth rate becomes 4.20%. What is the likely resultant percentage change in the intrinsic value of the company's shares?

a.

17.1%

b.

20.7%

c.

14.1%

d.

15.5%

e.

18.8%

please show working out!

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