Homework Answers
Expected Dividend, D1 = $2.00
Required Return, RA = 8%
Growth Rate, g = 3%
Stock Price, P0 = D1 / (RA - g)
Stock Price, P0 = $2.00 / (0.08 - 0.03)
Stock Price, P0 = $2.00 / 0.050
Stock Price, P0 = $40.00
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