Since it has been in business, FreeFin has paid a $1 per share annual dividend. The company
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Since it has been in business, FreeFin has paid a $1 per share annual dividend. The company plans to pay a $1 dividend for the next two years. Beginning in three years, however, FreeFin plans to increase the dividend by 8 percent each year for the remainder of the company’s life. If investors require a 17 percent rate of return to purchase FreeFin’s common stock, what should be the market value of its stock today?
DividendA dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...
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