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  3. a stock will pay a dividend of $3.00 next year and

A stock will pay a dividend of $3.00 next year and $1.70 two years from...

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Finance

A stock will pay a dividend of $3.00 next year and $1.70 two years from now.

Every year after that, the dividend will grow at a constant rate of 2.60%, indefinitely.

If the stock's required rate of return is 7.40%, what is the fair price of the stock according to a dividend discounting model?

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