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CX Enterprises has the following expected dividends: $1.02 in one year, $1.23 in two years, and $1.33 in three years. After that, its dividends are expected to grow at 3.7% per year forever (so that year 4's dividend will be 3.7% more than $1.33 and so on). If CX's equity cost of capital is 12.3%, what is the current price of its stock? The price of the stock will be $ (Round to the nearest cent.)

CX Enterprises has the following expected dividends: $1.02 in one year, $1.23 in two years, and $1.33 in three years. After that, its dividends are expected to grow at 3.7% per year forever (so that year 4's dividend will be 3.7% more than $1.33 and so on). If CX's equity cost of capital is 12.3%, what is the current price of its stock? The price of the stock will be $ (Round to the nearest cent.)

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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CX Enterprises has the following expected dividends: $1.02 in one year, $1.23 in two years, and $1.33 in three years. After that, its dividends are expected to grow at 3.7% per year forever (so that year 4's dividend will be 3.7% more than $1.33 and so on). If CX's equity cost of capital is 12.3%, what is the current price of its stock? The price of the stock will be $ (Round to the nearest cent.)
Transcribed Image Text:CX Enterprises has the following expected dividends: $1.02 in one year, $1.23 in two years, and $1.33 in three years. After that, its dividends are expected to grow at 3.7% per year forever (so that year 4's dividend will be 3.7% more than $1.33 and so on). If CX's equity cost of capital is 12.3%, what is the current price of its stock? The price of the stock will be $ (Round to the nearest cent.)
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