Use the following information and the dividend discount model to find the value of GoFlower, Inc.'s, common stock.
Last year's dividend was $3.10 per share.
The growth rate in dividends is estimated to be 10% forever.
The return on the market is expected to be 12%.
The risk-free rate is 4%.
GoFlower's beta is 1.1.
A) $34.95.
B) $121.79.
C) $26.64.
Answer: B
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