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What would be the price of the stock if such stock exists

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Reference no: EM133012975

Question - If a firm's discount rate is 0.1, and the growth rate of its dividends is 0.11. The next annual dividend is $2, to be paid one year from now.

Required -

1. Can you use the growing perpetuity formula to calculate the stock price?

2. What would be the price of the stock if such stock exists?

Reference no: EM133012975

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