Membo Inc. just paid a dividend of $4.6 per share.  Dividends are expected to grow at 6%, 5%, and 3% for the next three years respectively.  After that the dividends are expected to grow at a constant rate of 2% indefinitely.  Stockholders require a return of 9 percent to invest in Membo’s common stock.  Compute the value of Membo’s common stock today. (SHOW ALL WORK IN WORD FORMAT PLEASE)

ENGR.ECONOMIC ANALYSIS
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ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
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  1. Membo Inc. just paid a dividend of $4.6 per share.  Dividends are expected to grow at 6%, 5%, and 3% for the next three years respectively.  After that the dividends are expected to grow at a constant rate of 2% indefinitely.  Stockholders require a return of 9 percent to invest in Membo’s common stock.  Compute the value of Membo’s common stock today. (SHOW ALL WORK IN WORD FORMAT PLEASE)
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A dividend is the part of profit that a corporation distributes to its shareholders. Dividends are the primary benefit of investing in a firm. Cash, shares, property, and other forms of distribution are all possible for dividends. Rates of dividends may change from year to year.

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