What stock worth today at a discount rate of six percent

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Problem 1: Beta Co. will pay $6.9 a share next year. Its dividends will grow at 4.3% until Year 3, and after the third year, dividends will grow at 1.8% forever. What is this stock worth today at a discount rate of 8.8 percent?

Problem 2: Beta Co. just paid $3.2 a share this year. Its dividends will grow at 2.6% for three years, and after the third year, dividends will grow at 1.5% forever. What is this stock worth today at a discount rate of 6.0 percent?

Reference no: EM132959379

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