What is firm share price

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Question - XYZ is expected to pay a dividend of $6 for the next five years. Thereafter, the dividend is expected to grow at 2% p.a., in perpetuity. What is firm's share price, if its shareholders expect to earn a return of 10% p.a.?

a. $70.25

b. $62.50

c. $69.31

d. $60.75

e. None of the other answers is correct

Reference no: EM132603817

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