Dividend discount model to find the value of stock


Question: Draper Company's common stock paid a dividend last year of $3.70. You believe that the long-term growth in the dividends of the firm will be 8% per year. If your required return for Draper is 14%, how much are you willing to pay for the stock? Show all work to receive full credit.

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Finance Basics: Dividend discount model to find the value of stock
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