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Alex's firm is fast growing. Therefore, it will pay no dividend for the next 5 years....

Alex's firm is fast growing. Therefore, it will pay no dividend for the next 5 years. After that, Alex's firm will initiate dividend payment. The first dividend will be $2 (at the end of the 6th year) and the dividend will grow at a rate of 5% for 10 years. Then the industry starts to stabilize, and Alex'ss firm will pay $3 forever. If the required rate of return is 10%, calculate the stock price.

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jeff jeffy answered 1 year ago
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