Rate of return earned on reinvested funds is constant

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Reference no: EM131908779

A stock sells for $30. The next dividend will be $3 per share. If the rate of return earned on reinvested funds is a constant 15% and the company reinvests 40% of earnings in the firm, what must be the discount rate? (Do not round intermediate calculations. Enter your answer as a whole percent.) Discount rate %

Reference no: EM131908779

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