Calculating value of common stock

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Reference no: EM1365343

The last dividend paid by Klein Company was $2.00 (that is D=$2.00). Klein's growth rate is expected to be a constant 5% for next three years, after which dividends are expected to grow at a rate of 10% forever. Klein's required rate of return on equity is 16%. What will be the price of Klein's common stock two years from today (i.e., right after you receive second dividend)? Note: You need to count up to three decimal points.

Reference no: EM1365343

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