What is the maximum price

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Reference no: EM13262764

Valorous Corporation will pay a dividend of $1.80 per share a this year's end and a dividend of $2.40 per share at the end of next year. It is expected that the price of Valorous stock will be $44 per share after two years. If Valorous has an equity cost of capital of 8%, what is the maximum price that a prudent investor would be willing to pay for a share of Valorous stock today?

Reference no: EM13262764

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