Question
Using the information in Exhibit 7.4 for NewFangled Sports Products, Inc., calculate the new NPV of a share of stock if the perpetual growth rate
Using the information in Exhibit 7.4 for NewFangled Sports Products, Inc., calculate the new NPV of a share of stock if the perpetual growth rate doubled from 4% to 8%. Additionally, if the terminal year dividend payment went from $1.40 to $2.80, what is the new share price?
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Introduction to Finance Markets, Investments and Financial Management
Authors: Ronald W. Melicher, Edgar A. Norton
16th edition
1119398282, 978-1-119-3211, 1119321115, 978-1119398288
