Medical Corporation of America (MCA) has a current stock price of $36 and its last dividend (D0) was $2.40. In view of MCA’s strong financial position, its required rate of return is 12 percent. If MCA’s dividends are expected to grow at a constant rate in the future, what is the firm’s expected stock price for five years?
The question belongs to Finance and it discusses about calculating the expected stock price of a company for the next five years. The calculation has been given in the solution.
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