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You are considering investing in a common stock. You will receive a payment of $100 one year from today from the stock. You will continue
You are considering investing in a common stock. You will receive a payment of $100 one year from today from the stock. You will continue to receive payments from the stock each year forever, but the payments will become 5 percent larger in each successive year. You require a 15 percent rate of return on this type of investment. Using a dividend valuation model, how much is the most you should be willing to pay to buy a share of this stock?
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