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Unformatted text preview: t is & t = : 005 = (1 + : 0025 t ) . 3. Find the present value of a dividend paying stock. Assume: (a) that dividends are paid annually, (b) the next dividend is $5 and is paid one year from now, (c) that dividends increase every other year by 2%, (d) and that the annual e/ective rate of interest is 5%. 1...
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This note was uploaded on 02/07/2010 for the course ACTSC 231 taught by Professor Chisholm during the Spring '09 term at Waterloo.
- Spring '09