What the stock should be worth today

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Question - Mason's Bike Repair is expected to pay a dividend in year 1 of $1.00, a dividend in year 2 of $1.75, and a dividend in year 3 of $2.50. After year 3, dividends are expected to grow at the rate of 5% per year. An appropriate required return for the stock is 15%. Using the multistage DDM, what the stock should be worth today.

Reference no: EM133035994

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