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A fast-growing firm recently paid a dividend of $0.20 per share. The dividend is expected to
increase at a 20 percent rate for the next three years. Afterwards, a more stable 10 percent growth
rate can be assumed. If an 11 percent discount rate is appropriate for this stock, what is its value
today? Note: Do not round intermediate calculations. Round your answer to 2 decimal places.
Stock Value:

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A fast-growing firm recently paid a dividend of $0.20 per share. The.pdf

  • 1. A fast-growing firm recently paid a dividend of $0.20 per share. The dividend is expected to increase at a 20 percent rate for the next three years. Afterwards, a more stable 10 percent growth rate can be assumed. If an 11 percent discount rate is appropriate for this stock, what is its value today? Note: Do not round intermediate calculations. Round your answer to 2 decimal places. Stock Value: