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Voltron Inc. expects to pay abnormal dividends over each of the next 3 years of D1 = $3.50 at the end of this upcoming year,
Voltron Inc. expects to pay abnormal dividends over each of the next 3 years of D1 = $3.50 at the end of this upcoming year, D2 = $4.00 and the end of the second year, and D3 = $3.75 at the end of the third. If the growth is then expected to level off at 5.0%, and your required rate of return is 10.0%, a. What is the horizon term? b. What is the horizon value? c. How much should you be willing to pay for this stock today (What is P_0)?
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