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What is the stock's value now? What is its expected dividend yield and its capital gains yield in year 1 and year 4?

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1. A company's stock is selling at $30.29 (currently). Suppose the company is expected to experience zero growth during the first 3 years and then to resume its steady-state growth of 6% in the 4th year. What is the stock's value now? What is its expected dividend yield and its capital gains yield in year 1 and year 4?

2.Assume that the company's earnings and dividends are expected to decline by a constant 6% per year, that is g= -6%. Why would anyone be willing to buy such a stock and what price should it sell at? What would be the dividend yield and capital gains yield each year?

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The expert examines stock values and expected dividend yields.

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1. A company's stock is selling at $30.29 (currently). Suppose the company is expected to experience zero growth during the first 3 years and then to resume its steady-state growth of 6% in the 4th year. What is the stock's value now? What is its expected dividend yield and its capital gains ...

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