Adobe plans to start paying dividends in $5$ years $($that is$,$ in Year $5).$ The first dividend will be $$0\mathrm{.}50$

and the dividends are expected to grow at $3\%$ forever. What is the price of the stock today if the

required rate of return is $10\%?$

Draw the timeline, label the cash flows and growth rates, show with arrows whether you are

compounding or discounting.

Show the formulas you would use to solve the problem as if you did not have a

financial calculator on hand. Round all steps to four decimals.