Dividend is expected to grow at some constant rate

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ABC is expected to pay a dividend of $3.9 per share at the end of the year. The stock sells for $116 per share, and its required rate of return is 11.6%. The dividend is expected to grow at some constant rate, g, forever. What is the growth rate (i.e. solve for g)? Note: Enter your answer rounded off to two decimal points. Do not enter % in the answer box. For example, if your answer is 0.12345 then enter as 12.35 in the answer box.

Reference no: EM131966537

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