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You invest in a new security that will payout cash flow each year, forever. The next cash flow will be sent one year from today,
You invest in a new security that will payout cash flow each year, forever. The next cash flow will be sent one year from today, and will equal $1,200. In addition, subsequent cash flows will increase by 3 percent each year, thereafter. What is the value today of this security if the appropriate required return is 7.4 percent?
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