What is the discount rate that justifies stock price

Reference no: EM131956272

Question: Coca-Cola's current stock price is $42.20. It plans to pay a dividend of $2.10 next year (e.g., at t=1) and analysts forecast that Coca-Cola's dividends will grow at 5% forever. According to the dividend growth model, what is the discount rate that justifies this stock price?

Reference no: EM131956272

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