Find what is a fair value of the share today

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Problem 1: A share is expected to pay a dividend of $1.40 in one year. This dividend is expected to increase at an annual rate of 5% forever. If the required return is 15%, what is a fair value of this share today?

a. $15.40

b. $14.70

c. $1.40

d. $9.33

e. $14.00

Reference no: EM132760036

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