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The newspaper reported last week that Bradley Enterprises earned $2 per share this year. Bradley retains 60 percent of its earnings to reinvest in the company, where the return on the reinvestment is 14 percent. The cost of capital of Bradley is 12 percent.
What is the value of the Bradley's stock?
From where does this stock get most of its value: the earnings generated by the existing assets or the expected growth opportunities? Show your calculations
WSM Wine Importers, Inc. purchased 75,000 cases of French wine at a cost of 6,000,000 Euros. If the current exchange rate is 0.7576 Euros to the U.S. dollar, what is the purchase price of the wine in U.S. dollars?
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