Share of stock of platinum water packaging

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Reference no: EM132010270

Goran owns one share of stock of Platinum Water Packaging and one share of stock of White Mountain Consulting. The total value of his holdings is 211.47 dollars. Both stocks pay annual dividends that are expected to continue forever. The expected return for Platinum Water Packaging stock is 17.53 percent and its annual dividend is expected to remain at 12.58 dollars forever. What is the expected return for White Mountain Consulting stock if its next dividend is expected to be 13.51 dollars and all subsequent dividends are expected to grow by 5.5 percent annually? The next dividend for both firms’ stocks will be paid in one year. Answer as a rate in decimal format so that 12.34% would be entered as .1234 and 0.98% would be entered as .0098.

Reference no: EM132010270

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