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What is the stock value under the conditions

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Question 1: Star Ltd. just paid dividends of $2 per share. Assume that over the next three years dividends will grow as follows, 5% next year, 15% in year two, and 25% in year 3. After that growth is expected to level off to a constant growth rate of 10% per year. The required rate of return is 15%. What is the stock's value under these conditions?

Select one:

Option a. $45

Option b. $49.33

Option c. $37.5

Option d. $24.28

Reference no: EM132543908

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