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The price of Myrtle's Plumbing Supply Co. is now $83. The company pays no dividends. Ms. Bossard expects the price 3 years from now to
The price of Myrtle's Plumbing Supply Co. is now $83. The company pays no dividends. Ms. Bossard expects the price 3 years from now to be $105 per share. Should she buy Myrtle's Plumbing stock if she desires a rate of return of 8%? Explain. (Hint: Evaluate this situation using justified price (intrinsic value). In this case ignore dividends.)
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