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Your company paid a dividend of $3.00 last year (D0 =3.0). The growth rate is expected to be 10 percent for first year, 8 percent
Your company paid a dividend of $3.00 last year (D0 =3.0). The growth rate is expected to be 10 percent for first year, 8 percent the second year, then 7 percent for the third year, and then the growth rate is expected to be a constant 6 percent thereafter. The required rate of return on equity (rs) is 10 percent. What is the companys current stock price (i.e., intrinsic value)?
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