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(Solved by Expert Tutors) Motor Homes Inc. (MHI) is presently in a stage of abnormally high>


growth because of a surge in the demand for motor homes. The company expects earnings and dividends to grow at a rate of 20 percent for the next 4 years, after which time there will be no growth (g=0) in earnings and dividends. The company's last dividend was $1.50. MHI's beta is 1.6, the return on the market is currently 12.75, and the risk-free rate is 4 percent. What should be the current price per share of common stock?

 


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Apr 19, 2020

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