Question
In: Finance
Bob is worried about his job security, and has started to venture into a new startup....
Bob is worried about his job security, and has started to venture into a new startup. Perhaps surprisingly, he is able to take his startup to IPO within a 5-year period (please allow me to dream). The firm has just announced its first dividend of $3/share and the firm’s dividend is expected to grow extremely fast for 4 years in a row at 30% each year. However, Bob expects that the company will only grow at 5% after that forever. Expected return (discount rate) for stocks is 12%. Please use the dividend discount model to price the stock at t=0.
Solutions
Expert Solution
AS NOTHING WAS MENTIONED, DIVIDEND ARE ROUNDED TO TILL 4
DECIMALS. IF YOU WANT TO ME TO DO SOME OTHER ROUNDING, LET ME KNOW,
WILL DO ACCORDINGLY. THANK YOU
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that contains information on the company’s health insurance
options. Aerosystems offers its employees the choice between a
private insurance company plan (Blue Cross/Blue Shield), an HMO,
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