Acme Medical Corp.

2. The XYZ Corporation pays a dividend of $1 for each share and its required rate of return is 8%. Answer the following questions: A. Assuming zero growth in dividends, what is the value of each share? B. Now assume a 4% annual growth rate in the dividend paid. What is the value of each share? C. Assume the growth rate is still 4%, but the required rate of return drops to 6%. What is the new value of each share?

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