How much are you willing to pay to buy one share of stock

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Question: XYZ Company announced today that it will begin paying annual dividends next year. The first dividend will be $0.1 a share. The following dividends will be $0.15, $0.20, and $0.25 a share annually for the following 3 years, respectively. After that, dividends are projected to increase by 2 percent per year.

How much are you willing to pay to buy one share of this stock today if your desired rate of return is 7%?

Reference no: EM132753526

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