Question: Problem 8-17 Changes in Growth and Stock Valuation (LG8-5) Consider a firm that had been priced using a 10 percent growth rate and a 12

Problem 8-17 Changes in Growth and Stock Valuation (LG8-5)

Consider a firm that had been priced using a 10 percent growth rate and a 12 percent required return. The firm recently paid a $1.20 dividend. The firm just announced that because of a new joint venture, it will likely grow at a 10.5 percent rate.

How much should the stock price change (in dollars and percentage)?

Note: Round your answers to 2 decimal places.

Change in stock price: $

Change in stock percent: %

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