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You are considering issuing a stock that will pay a dividend of $1.00 a year from today. The base case assumption is that the dividend
You are considering issuing a stock that will pay a dividend of $1.00 a year from today. The base case assumption is that the dividend will grow at an annual rate of 10% for two years after that, then at 6% for another five years and then will grow at 4% annually for ever. If the required rate of return on similar stocks is 12% what should be the price of the stock?
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