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If you are looking for a return of at least 10%, what would you invest in...

If you are looking for a return of at least 10%, what would you invest in a company, given that its just paid a dividend of 1.80, and estimates a growth rate of 3%?

Please use calculations for excel

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Answer #1

Cost of equity = ke = D1 = 10.00% 3.00% $1.85 $26.49 1.85/(10% -3%) 1.8*1.03 Price = D1/(ke-g)

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