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    Nonstick Gum Factory dividend yields

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    You believe that Nonstick Gum Factory will pay a dividend of $2 on its common stock next year. Thereafter, you expect dividends to grow at a rate of 6 percent a year in perpetuity.
    a. If you require a return of 12 percent on your investment, how much should you be prepared to pay for the stock?

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    https://brainmass.com/business/accounting-for-corporations/nonstick-gum-factory-dividend-yields-206418

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    dividend yields
    You believe that Nonstick Gum Factory will pay a dividend of $2 on its common stock next year. Thereafter, you ...

    Solution Summary

    This solution is comprised of a detailed explanation to answer how much should you be prepared to pay for the stock.

    $2.19