February 20, 2017

Homework Help: Finance

Posted by Linda Chapman on Monday, November 1, 2010 at 7:52pm.

Cascade Mining Company expects its earnings and dividends to increase by 7 percent per
year over the next six years and then to remain relatively constant thereaft er. Th e fi rm
currently (that is, as of year 0) pays a dividend of $5 per share. Determine the value of a
share of Cascade stock to an investor with a 12 percent required rate of return.

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