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Under a no-growth policy, the Widget Maker corporation is expected to generate annual earnings per share of E . However, every year, the corporation plans

Under a no-growth policy, the Widget Maker corporation is expected to generate annual earnings per share ofE. However, every year, the corporation plans to distribute only 70% of its annual earnings in dividends to its shareholders, and reinvest the balance in new projects. These new projects are expected to generate annual returns of 20% in perpetuity. Given its risk, the appropriate discount rate for Widget Makeris 10%. What fraction of Widget Maker's stock price today is attributable to growth opportunities?

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