OAB company intends to distribute dividends to its stockholders amounting to BD12 per share next year. The
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- OAB company intends to distribute dividends to its stockholders amounting to BD12 per share next year. The amount represents 15% return of investor’s money. However, the company as part of its strategy, plow 40% of its earnings back to the company’s return on equity of 25%. Determine the value of the stock before plow-back and the value after plow-back.
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