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A company has been growing at a fast rate of 25% per year recently and...

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Finance

A company has been growing at a fast rate of 25% per year recently and this growth rate is expected to last for another three years. Thereafter, the growth rate is expected to decline to a sustainable rate of 10%.

i) Briefly discuss the limitations of the Constant Growth Model in the valuation of stocks with appropriate exp. (6 mark)

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