You have the following nonconstant stock: D0 = $3.50, ks = 11.60%
Question # 00225009
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Updated on: 03/19/2016 03:44 AM Due on: 04/18/2016
How do I do this problem
You have the following nonconstant stock: D0 = $3.50, ks = 11.60%, dividend growth rates are as follows: Year 1 = 25%, year 2 = 14%, year 3 = 13%, after which the growth goes constant at 6.90% forever. What is the dividend yield for year 2?
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Solution: You have the following nonconstant stock: D0 = $3.50, ks = 11.60%