How much would you be willing to pay per share

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The stock of Carroll's Bowling Equipment currently pays a dividend (D0) of $3. This dividend is expected to grow at an annual rate of 15 percent for the next three years.

The dividend is expected to increase by $1 in year 4 and to grow at a constant annual rate of 6 percent thereafter. If you require a 24 percent rate of return on an investment such as this, how much would you be willing to pay per share?

Reference no: EM131338541

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