Question: Please send clear solutions, will up vote! Thank you Question Two Consider the stock of the Company, which has developed a new product and is

Please send clear solutions, will up vote! Thank you Question Two

Please send clear solutions, will up vote! Thank you

Question Two Consider the stock of the Company, which has developed a new product and is enjoying rapid growth. The dividend for a share of stock a year from today will be K1.15. During the next for years, the dividend will grow at 15% per year. After that, growth will be equal to 9% per year. The initial investment was K27. Assume the discount rate is 15%. a. Compute the present value of the inflows. b. What is the NPV from the investment? c. Is the stock worth investing? Explain

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