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Umbrella has announced that the dividend on their stock will grow at a constant rate of 5% for next 3 years. After 3 years (starting
Umbrella has announced that the dividend on their stock will grow at a constant rate of 5% for next 3 years. After 3 years (starting in year 4), the growth rate is 2% forever. Next dividend (dividend at the end of year 1) is $4. If the discount rate is 10%, what should be the price of the stock today?
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