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Business, 06.04.2021 01:00 cmcdonnell8812

Suppose Acap Corporation will pay a dividend of per share at the end of this year and per share next year. You expect​ Acap's stock price to be in two years. Assume that​ Acap's equity cost of capital is . a. What price would you be willing to pay for a share of Acap stock​ today, if you planned to hold the stock for two​ years? b. Suppose instead you plan to hold the stock for one year. For what price would you expect to be able to sell a share of Acap stock in one​ year? c. Given your answer in ​(b​), what price would you be willing to pay for a share of Acap stock today if you planned to hold the stock for one​ year? How does this compare to your answer in ​(a​)?

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