Jazper, Inc. just paid a dividend of $4.12 per share (that is, D0 = 4.12). If the growth rate in Jazper’s dividends is expected to shrink every year (forever) by 8 percent (that is, g = -8.0% = -.08) and if Jazper’s required rate of return on equity is 26.2%, what is the current equilibrium price of Jazper’s stock?

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We can use the Gordon growth model to calculate the current eq... View the full answer