What is the value of a share of gillette stock


Problem

Assume Gillette Corporation will pay an annual dividend of $0.63 one year from now. Analysts expect this dividend to grow at 11.3% per year thereafter until the 6th year. Thereafter, growth will level off at 1.6% per year. According to the dividend-discount model, what is the value of a share of Gillette stock if the firm's equity cost of capital is 8.7%?

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Microeconomics: What is the value of a share of gillette stock
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