Calculate the current stock Fair Value for a firm that is expected to have extraordinary growth of 25% for four years, after which it will face more competition and slip into a constant growth rate of 5%. Its required return is 14% and next year's dividend is expected to be $5.00.

A) $87.68
B) $95.20
C) $83.33
D) $76.50

Ans: A) $87.68

Business

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