The immediate dividend would be worth $1.5 million. In addition, you now have a growing perpetuity that

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The immediate dividend would be worth $1.5 million. In addition, you now have a growing perpetuity that starts with a payment of $1.530 million. Therefore, the PV would be $1.500 + $1.530/12% = $14.250 million. Alternatively, you could multiply the $12.5 million from your answer to Question 3.10 by

(1 + 14%).

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