What is the implied net present value of future investments

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Reference no: EM132069315

In order to evaluate the stock of The Rendell-Vine Corporation, an analyst uses the constant growth discounted dividend model. Expected earnings of $12 per share is assumed, as are an earnings retention rate of 70% and an expected rate of return on future investments of 17% per year. If the market capitalization rate is 14% per year, what is the implied net present value of future investments?

Reference no: EM132069315

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