What is the value of a share of change-all common stock

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1. The Change-all Company currently pays $2.00 of dividends on each share of common stock. The required rate of return on Change-all stock is 10%.

a. If the expected dividend growth rate is 5% each year, forever, what is the value of a share of Change-all common stock?

b. If the expected dividend growth rate is 2% each year, forever, what is the value of a share of Change-all common stock?

c. If the dividend growth is expected to be 5% for the next five years and 2% thereafter, what is the value of a share of Change-all common stock?

2. The AlterG Corporation currently pays $3.00 of dividends per share of common stock. The required rate of return on AlterG stock is 5%. If the dividend growth rate is expected to be 4% per year of the next four years and 2% thereafter, what is the value of a share of AlterG common stock?

Reference no: EM132510034

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