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Question
Hypo Tech expects its net income to grow at 20 percent a year for the next two years and then taper off to a constant 5 percent annual rate of growth. The firm maintains a constant dividend payout ratio. Which one of the following models is best suited for computing the current value of this firm's stock?A. irregular dividend
B. constant perpetual growth
C. constant dividend
D. two-stage dividend growth
E. perpetuity formula
Answer
This answer is hidden. It contains 15 characters.
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