Declining growth stock valuation

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Reference no: EM13883341

Declining Growth Stock Valuation

Brushy Mountain Mining Company's coal reserves are being depleted, so its sales are falling. Also, environmental costs increase each year, so its costs are rising. As a result, the company's earnings and dividends are declining at the constant rate of 3% per year. If D₀ = $3 and r_s = 18%, what is the value of Brushy Mountain's stock? Round your answer to the nearest cent.

Reference no: EM13883341

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