Question: A firm projects that dividends will grow at a rate of 6% per year for four years and then will grow at a rate of
A firm projects that dividends will grow at a rate of 6% per year for four years and then will grow at a rate of 4% per year forever. The stock's required return is 8% and the last annual dividend paid was $1.40. The most an investor should be willing to pay for this stock today is ______. (Watch your rounding, carry out dividends to four or more decimal places.)
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