What will be the value of festige holdings shares

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Problem 1: Assume at the end of Year 1 you are considering investing the after-tax cash benefits of US$6000 in Festige Holdings a mature firm in the food and beverage industry. The firm's most recent common stock dividend was US$5.00 per share. Because of the firm's maturity and stable sales and earnings, firm's management feels that dividends will remain at the current level for the foreseeable future. If the required return on similar type shares is 7% what will be the value of Festige Holdings shares and how many shares should you purchase.

Reference no: EM132779056

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