If a new company is expected to growth exponentially and pay dividends
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If a new company is expected to growth exponentially and pay dividends

If a new company is expected to growth exponentially and pay dividends of $1, $2, and $3, for the first 3 years, respectively. After that time the growth is expected to be at 5% thereafter. The required rate of return is 10%.  You can use the PV and the Gordon Growth model to estimate the value of the stock.

Hint
Accounts & FinanceGordon growth model (GGM): This model assumes that the company exists forever and that there is a constant growth in dividends when valuing the stock of the company. This model works by taking an infinite series of the dividends per share and discounting them back into the present by using the required rate of return....

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