Stock Price = Expected Dividend/(Required return – growth rate)
= 0.75(1+5.50%)/(13.5%-5.50%)
= $9.890625
I.e. $9.89
18.Corporate value is equal to the present value of free cash flows
= -15/(1.13) + 10/(1.13)^2 + 25/(1.13)^3 + 25(1.05)/(1.13)^3(13%-5%)
= $239.29 millions
Question 17 1 pts dividende per dividend is expected to grow at a constant rate of...
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