What will be the value of your shares of stocks

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Question

You own 100 shares of the stock of unlevered Siena company which has 1,000 shares outstanding. Siena plans to pay $4,600 dividend at the end of the current year (i.e. at the end of one year from today) and a liquidating dividend of $10,580 at the end of 2 years from today. The required (expected) return on Siena's stock is 15%. Ignoring personal taxes and transaction costs:

What will be the value of your shares of stocks?

Reference no: EM133495883

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