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Risk premium associated with stock

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MacLean, Inc. currently pays no dividends. Today, the firm announced that it will pay its first dividend of $1 per share in four years, then $1.50 in each of the following three years, and the subsequent dividends are expected to grow at a constant rate of 5 percent per year.

What is the stock price today if the risk free rate is 4 percent and the risk premium associated with this stock is 6 percent?

Reference no: EM131069921

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