ABC Company just paid a dividend of $5.00. Dividends are expected to grow 8 percent per year for the next three years, and 6 percent for each of the following two years. After this time, growth is expected to return to a long-run constant rate of 4 percent. The required rate of return (r_s) on the stock is 9 percent. (8 points)

a) Calculate the present value of each dividend for years 1-5.

b) Calculate the stock price as of the end of year 5.

c) Calculate the current stock price (P₀).

d) Calculate the dividend yield (D₁/P₀) and the expected capital gains yield for the first year.