Business, 17.04.2020 18:04 crystal070903

You read in the paper that Summit Systems will pay a dividend of$2.00 this year. At that point you expected. Summit Systems has an equity cost of capital of 10.0 %, will pay a dividend of $1.75 in one year, and its dividends had been expected to grow by 7.0 % per year. You read in the paper that Summit Systems has revised its growth prospects and now expects its dividends to grow at a rate of 3.0 % per year forever. he firm's equity cost of capital is 10.0%.
a. What is the value of a share of Summit Systems stock based on the original expected dividend growth of 6.0 %6.0% per year?
b. If you tried to sell your Summit Systems stock after reading this news, what price would you be likely to get? Why?
a. What is the value of a share of Summit Systems stock based on the original expected dividend growth of 6.0% per year?

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