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Bill’s Bakery expects earnings per share of $2.34 next year. Current book value is $4.1 per share. The appropri...

Bill’s Bakery expects earnings per share of $2.34 next year. Current book value is $4.1 per share. The appropriate discount rate for Bill’s Bakery is 15 percent. Calculate the share price for Bill’s Bakery if earnings grow at 2.7 percent forever. (Do not round intermediate calculations. Round your answer to 2 decimal places. Omit the "$" sign in your response.)

   

  Share price $   
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Answer #1

Calculate current market price as follows 1 EPS 2 Current book value 3 Required returrn 4 Earning growth rate 5 Return on e 6

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