Cash flows are expected to have zero growth rate

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The Buccaneer Corporation has announced a dividend to be paid this year of $2.00 per share (D_1 = $2.00) On the basis of review of similar-risk opportunities, they must earn at least an 18% rate of return on all investments.

What is the firm's value if cash flows are expected to have a zero growth rate from now to infinity?

What is the firm's value if cash flows grow at a constant rate of 7% from now to infinity?

Reference no: EM131518188

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