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A company's dividend grows at a constant rate of 5 percent p.a.. Last week it paid a dividend of $2.93. If the

required rate of return is 13 percent p.a., what is the price of the share 2 years from now? (round to nearest cent)

Select one:

a. $42.40

b. $40.38

c. $33.20

d. $49.10

Top Answer

price of the share2 years from now = $42.40 Dividend paid previously (D 0 ) = $2.93 Growth rate (g) = 5% Require rate of... View the full answer

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