CBC stock is expected to sell for $22 two years from now. Supernormal growth of 5% is expected for the next two years. The current dividend is $1 and the required return is 15%. What constant growth rate is expected beginning in year 3?

a. 6.5% 

b. 6.7% 

c. 8.1% 

d. 8.4% 

e. 9.5%

Answer rating: 100% (QA)

constant growth rate g g Re D21gP2 g 15 ... View the full answer