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Cascade Mining Company expects its earnings and dividends to increase by 7% per year over the next six years and then to remain relatively constant thereafter. The firm currently (as of year 0) pays a dividend of $5 per share. Determine the value of a share of Cascade stock to an investor with a 12% required rate of return.

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Solution Summary

Excel spreadsheet is used to find the value of a share of stock with a 12% required rate of return.

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