Implied constant growth rate of dividend


Shares of stock in the WHY company are selling for $65 today, and a dividend of $3.75 is expected next year. The dividend is expected to grow at a constant rate forever. The firm has a beta associated with its equity of 1.2. The risk-free rate of return is 5% and the expected market risk premium is 3%. What is the implied constant growth rate of the dividend?

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Finance Basics: Implied constant growth rate of dividend
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