7. You expect Manchester Corporation to pay a dividend per share of $3 at the end of the first year. $3.50 at the end of the second year, and $4 at the end of the third year. Beyond the third year dividends will be paid at the end of each year and they are expected to grow at a rate of 2% forever. Asswing Manchester Corporation shareholders require a rate of return of 8% per year, what should the current share price of Manchester Corporation be? A) $48.65. B) $61.86. C) $62.93. D) $63.25. 3 .087.082 1.08 3.5 47 4x (1+0.02) 3 0.08-0.02 =68