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The required rate of return for x stock is 1 7 . 5 % . x pays out 3 5 % of its earnings in

The required rate of return for x stock is 17.5%.x pays out 35% of its earnings in dividends and
the latest earnings announced were $10 per share. You expect that x will earn an ROE of 22% per
year on all reinvested earnings forever. What is the intrinsic value of x?
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