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After-tax return is expected on the investment

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A company has a retention ratio of 65%, net income of $85 million, and 12 million shares outstanding. How much should an investor pay now for a stock expected to sell for $60 one year from now if dividends are taxed at 40%, capital gains are taxed at 20%, and a 22% after-tax return is expected on the investment?

Reference no: EM132494901

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