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Over the past 7 years, the dividends of the Gamma Corporation have grown from $0.90 per share
to the current level of $1.20 per share (D0). This growth rate (computed to 1/10 of 1 percent
accuracy) is expected to continue for the foreseeable future. What is the value of a share of
Gamma Corporation common stock to an investor who requires a 20 percent return on her
investment? Use Table I to answer the question. Round your answer to the nearest cent.

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Over the past 7 years the dividends of the Gamma Corporatio.pdf

  • 1. Over the past 7 years, the dividends of the Gamma Corporation have grown from $0.90 per share to the current level of $1.20 per share (D0). This growth rate (computed to 1/10 of 1 percent accuracy) is expected to continue for the foreseeable future. What is the value of a share of Gamma Corporation common stock to an investor who requires a 20 percent return on her investment? Use Table I to answer the question. Round your answer to the nearest cent.