The company expects a constant growth in earnings and


The Company expects a constant growth in earnings and dividends of 4% into the foreseeable future. It is expected that the next dividend paid to stockholders will be $1.50/share. Currently the market of investor is demanding or requiring 12% on this investment. Show ALL work for full credit. a) What is the current value of the stock? b) What is the expected dividend yield and the expected capital gains yield today?

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Financial Management: The company expects a constant growth in earnings and
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