How much will you pay for a share of the stock

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Reference no: EM131452460

The Best Equipment Company just released a successful new and product. It is expected the will bring huge profits to the company, and its dividend will grow at 7% every year from now on. The last annual dividend of the company was $0.50 per share. The current risk-free rate of return is 5%, and you require a 6% risk premium to hold the stock. How much will you pay for a share of the stock?

Reference no: EM131452460

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