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Pinky1234Best ResponseYou've already chosen the best response.0
Thirsty Cactus Corp. just paid a dividend of $1.20 per share. The dividends are expected to grow at 35 percent for the next 8 years and then level off to a 6 percent growth rate indefinitely. Required : If the required return is 13 percent, what is the price of the stock today?
 one year ago

keenlearnerBest ResponseYou've already chosen the best response.0
\[d1=1.20(1+0.35)\div1.13^{1}\] \[d2=d1(1.035)\div(1.13)^{2}\] . . .d8\[=d7(1.035)\div(1.13)^{8}\] last cumulative dividend will be dn=\[d8\div(0.060.35)\]
 one year ago

keenlearnerBest ResponseYou've already chosen the best response.0
now all these dividends to get the price of stock today
 one year ago

keenlearnerBest ResponseYou've already chosen the best response.0
in d2 and d7 i have written 1.035...sorry i wroye it by mistake ..it will be 1.35
 one year ago
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