What is the present value of the stock if the effective


A stock pays dividends that are always one year apart. The stock will pay its next dividend nine months from today, in the amount of $3. The dividend will go up by 9% for each of the four subsequent payments. After that, the dividend will remain constant forever. What is the present value of the stock if the effective annual interest rate is 25%?

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Financial Management: What is the present value of the stock if the effective
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