Calculate the current expected price of the stock

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A stock just paid a dividend of $2.00. Due to the introducion of a proprietary product, the dividend growth rate is expected to e 30 percent for the next two years, 15 percent for years 3 and 4, and then return to a constant growth rate assumption of 4 percent thereafter. The required return on the stock is 18 percent. Calculate the current expected price of the stock.

Reference no: EM131950956

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