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You believe that the Non-stick Gum Factory will pay a dividend of $3 on its common stock next year. Thereafter, you expect dividends to grow
You believe that the Non-stick Gum Factory will pay a dividend of $3 on its common stock next year. Thereafter, you expect dividends to grow at a rate of 3% a year in perpetuity. If you require a return of 10% on your investment, how much should you be prepared to pay for the stock?
(Do not round intermediate calculations. Round your answer to 2 decimal places.) |
Stock price | $ |
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