Question: Hi! Can you explain how to solve this question, step by step to help me understand?! Thank you! prepared to pay for the stock? (L07-2)

Hi! Can you explain how to solve this question, step by step to help me understand?! Thank you!

Hi! Can you explain how to solve this question, step by step

prepared to pay for the stock? (L07-2) Constant-Growth Model. Horse and Buggy Inc. is in a declining industry. Sales, earnings, and dividends are all shrinking at a rate of 10% per year. (L07-2) a. If r= 15% and DIV, = $3, what is the value of a share? b. What price do you forecast for the stock next year? c. What is the expected rate of return on the stock? d. Can you distinguish between "bad stocks" and "bad companies"? Does the fact that the industry is declining mean that the stock is a bad buy? al Metatrend's stock will generate earnings of S6 per share this year. also is 15

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