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The dividend is expected to grow at some constant rate g

Star Manufacturing is expected to pay a dividend of $1.00 per share at the end of the year (D₁ = $1.00). The stock sells for $40 per share and its required rate of return is 10.5%. The dividend is expected to grow at some constant rate, g, forever. What is the equilibrium expected growth rate?

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Finance Basics: The dividend is expected to grow at some constant rate g

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