Agnes wants to purchase common stock of new frontier inc


Agnes wants to purchase common stock of New Frontier Inc. and hold it for 4 years. The directors of the company just announced that they expect to pay an annual cash dividend of $4.00 per share for the next 5 years. Agnes believes that she will be able to sell the stock for $40 at the end of four years. In order to earn 12% on this investment, how much should Agnes pay for this stock?

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Financial Management: Agnes wants to purchase common stock of new frontier inc
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