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QUESTION

Company A is growing quickly. Dividends are expected to grow at 30% for the next three years, after which growth and dividends are expected to be a...

Company A is growing quickly. Dividends are expected to grow at 30% for the next three years, after which growth and dividends are expected to be a constant 5.25%. The required rate of return is 15% and the company just paid a $0.85 annual dividend. What is the current share price?

a. 16.80

b. 15.55

c. 18.41

d. 13.30

e. 18.75

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