Valuation of declining growth stock

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Valuation of a declining growth stock

Maxwell Mining Company's ore reserves are being depleted, so its sales are falling. Also, because its pit is getting deeper each year, its costs are rising. As a result, the company's earnings and dividends are declining at the constant rate of 6% per year. If D0 = $4 and rs= 13%, what is the value of Maxwell Mining's stock? Round your answer to two decimal places.

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Reference no: EM131350877

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