1)The total value without dividend reinvestment equals the final stock price multiplied by the initial number of shares added to the sum of all dividends paid. The number of shares is simply the initial number of shares.

2)The total value with dividend reinvestment equals the final stock price multiplied by the sum of the initial number of shares plus all dividend reinvestment shares. The number of shares is the initial number of shares plus all the shares purchased with reinvested dividends.

3)The dividends paid without dividend reinvestment is the sum of yearly dividends paid on the initial number of shares.

4)The dividends paid with dividend reinvestment is the sum of yearly dividends paid on the initial number of shares and the reinvested dividends shares.

DRIP Evaluation Initial number of shares100 Initial stock price per share$100.00 Annual Dividend$2.00 Dividend annual growth rate3% Stock price annual growth rate5% Number of years10 SOLUTION Without DRIPWith DRIP Total Value in dollars($15,731.94)$19,322.98 Number of shares100116.7850 Dividends paid$5,731.94reinvested YearStart BalanceSharesShare PriceContributionDividend per shareGrowthDividendsReinvestedEnd Balance 1$10,000.00100.0000$100.000.00$2.00$500.00200.00200.00$10,700.00 2$10,700.00101.9048$105.000.00$2.06$535.00206.00206.00$11,441.00 3$11,441.00103.7732$110.250.00$2.12$572.05216.22216.22$12,229.27 4$12,229.27105.6410$115.760.00$2.19$611.46226.79226.79$13,067.53 5$13,067.53107.5069$121.550.00$2.25$653.38237.80237.80$13,958.70 6$13,958.70109.3701$127.630.00$2.32$697.94249.26249.26$14,905.90 7$14,905.90111.2301$134.010.00$2.39$745.29261.19261.19$15,912.38 8$15,912.38113.0863$140.710.00$2.46$795.62273.60273.60$16,981.60 9$16,981.60114.9381$147.750.00$2.53$849.08286.51286.51$18,117.19 10$18,117.19116.7850$155.130.00$2.61$905.86299.94299.94$19,322.98