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Lily Co. paid a dividend of $5.25 on its

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Question;Lily Co. paid a dividend of $5.25 on its common stock yesterday. The company's dividends are expected to grow at a constant rate of 8.5% indefinitely. The required rate of return on this stock is 15.5%. You observe a market price of $78.50 for the stock. Should you purchase this stock?

 

Paper#45314 | Written in 18-Jul-2015

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