Stock grsquos last dividend was 160 per share and is


Stock G’s last dividend was $1.60 per share and is expected to grow at a rate of 4%.

1. Using constant growth valuation formula, what is the expected price of the stock if my required return is 12%?

2. If the stock is selling at $23.50 should I purchase the stock?

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Financial Management: Stock grsquos last dividend was 160 per share and is
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