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Rework Table 7.4 for horizon years 1, 2, 3, and 10, assuming that investors expect the...

Rework Table 7.4 for horizon years 1, 2, 3, and 10, assuming that investors expect the dividend and the stock price to increase at only 6% a year and that each investor requires the same 12% expected return. Current dividends are $6.00. What value would Dritter place on the stock and what about Zehnte who has a 10-year horizon?

Horizon (years) PV (dividends) PV (terminal price) Value per share
1
2
3
10

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jeff jeffy answered 2 years ago
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