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1. ABC Company's last dividend was $2.8. The dividend growth rate is expected to be constant at 8% for 3 years, after which dividends are expected to grow at a rate of 4% forever. The firm's required return (rs) is 14%. What is its current stock price (i.e. solve for Po)?
2. ABC’s last dividend paid was $3.42, its required return is 22%, its growth rate is 7%. What is ABC's expected stock price in 8 years?
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