Calculating price of stock with three-year horizon
Calculate the price of a stock with a three-year horizon, when the stock is expected to pay $2.50 per share in dividends each year, and has an expected value of $100 at the end of the third year. The return on comparable stocks is 6%.
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Create a table showing both the origional values and the new values you have calculated. Which of the changes, (a) through (d), cause the greatest change in GDP in absolute dollars?
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