Question: P7-10 Common stock value: Constant growth Sweet Candy will pay a dividend of $0.72 per share next year. The CEO of the company declared that

P7-10 Common stock value: Constant growth Sweet Candy will pay a

P7-10 Common stock value: Constant growth Sweet Candy will pay a dividend of $0.72 per share next year. The CEO of the company declared that the company expects to maintain a constant growth rate of 7% per year every year from now on. a. What will be the price per share if the required return is 10%? b. What will be the price per share if the required return is 8%? c. Based on your answer in parts a and b, give one disadvantage of the constant growth model

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