11: Corporate Finance: Corporate Investing and Financing ...

The company's preferred stock sells for $42 a share and pays an annual dividend of $4 a share. The company's common stock sells for $28 a share and is expected to pay a dividend of $2 a share at the end of the year (i.e., D1=$2.00). The dividend is expected to grow at a constant rate of 7 percent a year. ................
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