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Determine the fair market value of the stock

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Question - Company Co. expects to pay a $1.10 dividend next year, an increase from $1.00 today. Management believes that the company can increase dividends by 12% per year in the foreseeable future. The risk-free rate is 6% and the expected return on the market portfolio is 11%. The stock has a beta of 1.4. Determine the fair market value of the stock?

Reference no: EM133079135

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