Question: Problem 1 1 - 1 8 - Dividend Discount Model A company paid a $ 1 . 5 5 per - share - per -

Problem 11-18- Dividend Discount Model
A company paid a $1.55 per-share-per-year dividend last year. It is expected to increase at an annual 8% growth rate to year five. After year five, the dividend will grow at 7% per year indefinitely. Suppose that the required rate of return is 10%.
D0 $1.55
1st Growth 8%
2nd Growth 7%
Required Rate 10%
What is the value of the stock?
The value of the stock is $
. Round your answer to the nearest two decimal places.

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