A share of stock just recently released a dividend for $0.67 per share, and has expected growth rate of 3.00% in the next year, 4.60% in the second year, 2.80% in the third year and 1.60% in the fourth year. Finally the firm expects the growth to become 4.20% long-term thereafter. Given that the expected discount rate on these bonds is 22.10%, what is the expected price of this stock? Could you please give a brief explanation to the steps you took to solve it.

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Heres how to calculate the expected price of the stock and a brief explanation of the steps 1 Define ... View the full answer