Constant dividend model-what will be price in three years

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Reference no: EM131994041

Boring, Inc. just paid a dividend of $1.50 per share on its stock. The dividends are expected to grow at a constant rate of 5 percent indefinitely. If the required return is 10% on the stock,

1. What is the current stock price (P0)?

2. What will be the price in three years (P3)?

(Hint for a and b: Use the constant dividend model)

Reference no: EM131994041

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