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What is the per share value of the common equity

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Reference no: EM132930569

Shady Sunglasses operates retail sunglass kiosks in shopping malls. Below are the estimates of its free cash flow for common equity shareholders for the next six years:

(in dollars and at year-end)        Year 1            Year 2        Year 3          Year 4         Year 5         Year 6

Cash Flow for Common Equity         392                 478          636             827            950              1,284

Problem 1: After year 6, the free cash flow is expected to grow at a steady rate of 4% per year. If the required return is 8.5% on Shady Sunglasses' common equity, what is the per share value of its common equity. Shady Sunglasses has 1,000 shares outstanding.

Reference no: EM132930569

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