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What is the value of Company B

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Question - Company B will pay a dividend of $3 Billion at the end of year 1 and a dividend of $4 Billion at the end of year 2. After year 2, the dividend will increase at a rate of 1% indefinitely. Assume a cost of equity of 10%. What is the value of Company B?

a. $48 Billion

b. $52 Billion

c. $57 Billion

d. $43 Billion

Reference no: EM133176196

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