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Part a. Green Tree Corporation is paying a dividend of $4 today. It expects dividends to...

Part a. Green Tree Corporation is paying a dividend of $4 today. It expects dividends to grow at 25 percent for the next three years and to stabilize at 10 percent per year thereafter. If the required rate of return of this corporation is 15 percent, what is the current price of this corporation's stock? (Answer must be shown in excel)

Part b. What percentage of the current stock price is due to the dividends in the first three years?

Part c. What percentage of the current stock price is due to the dividends from Year 4 onwards?

Part d. Discuss the results of Parts b and c above. (2 points)

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jeff jeffy answered 10 months ago
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