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You are considering the purchase of a stock that reported earnings per share of $2.68 in the most recent fiscal year. You expect the firms
You are considering the purchase of a stock that reported earnings per share of $2.68 in the most recent fiscal year. You expect the firms earnings to grow at 18% for the next ten years. After that you feel the growth in earnings will be 2.50% into the future. If you require a return of 15% on such an investment, what are you willing to pay for the shares today?
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