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Gordon model the share price

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Super Growth Corp. has decided to increase its dividend to \$5 per share beginning next year. The firm's growth rate is expected to be 12.5% for the foreseeable future. Investors require a rate of return on the firm's stock of 18%. Utilize the Gordon Model to calculate the expected price of the firm's stock.
a. \$64
b. \$75
c. \$83
d. \$91
e. \$98

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Super Growth Corp. has decided to increase its dividend to \$5 per share beginning next year. The firm's growth ...

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The solution uses the Gordon Model to calculate the expected price of the firm's stock.

\$2.19
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