If the required rate of return on the stock is 10 percent


A Company is expected to pay the following dividends over the next four years: $2.50, $1.25, $1.00, and $0.75. Beginning in year 5, the Company expects to maintain a constant 5 percent growth rate in dividends forever. If the required rate of return on the stock is 10 percent, what is the current share price?

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Financial Management: If the required rate of return on the stock is 10 percent
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