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Question
Ace Fly Rod Company expects the next dividend it pays, which will be in one year, to be $3. In the following year, the dividend is expected to be $4.50, and then the dividends are expected to grow at 10 percent annually thereafter. The appropriate discount rate for the company is 18 percent. What should be the market price of the stock?
a. $59.68
b. $57.58
c. $50.21
d. $46.17
e. $43.43
Answer
This answer is hidden. It contains 11 characters.
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