According to the nonconstant growth model discussed in the textbook, the discount rate used to find the present value of the expected cash flows during the initial growth period is the same as the discount rate used to find the PVs of cash flows during the subsequent constant growth period.

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The nonconstant growth model uses a single discount rate, typically the required rate of return or cost of equity, to discount all expected cash flows, regardless of whether they occur during the initial nonconstant growth period or the subsequent constant growth period. This is because the discount rate reflects the risk of the overall investment, not the phase of growth.

According to the Nonconstant Growth Model Discussed in the Textbook