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What is the price of a share of ABC Inc

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Question - ABC Inc. just paid a dividend of $2, which is expected to grow by 20% next year and then 10% after that. Assume the required return is 15%. What is the price of a share of ABC Inc. based on the dividend model?

Suppose right after next year's dividend is paid, someone decides to sell their shares. Based on the dividend model, what should be the price of those shares at that time?

Reference no: EM133135896

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