Apple has just paid a quarterly dividend of $3.92. Dividends are expected to grow by 10% for the next 4 quarters, and then grow by 1.2% thereafter. Apple has a required quarterly return of 4%. IB Attempt 1/10 for 10 pts. Part 1 What is the expected dividend in four quarters? 5.18 Correct Dividends during non-constant growth phase: Di = Do(1+gi) = 3.92 1.1 = 4.312 D2 = Do(1+91) = 3.92 1.12 = 4.743 D3 = D(1+91) 3.92 1.13 = 5.22 D4 = D.(1 +91)4 = 3.92 1.14 = 5.74 = = IB | Attempt 3/10 for 9 pts. Part 2 What is the terminal value (in the fourth quarter (P4)? 1321.64 Correct D4(1+9) P4 = 5.74. (1 + 0.012) 0.04 0.012 207.43 R-9 Part 3 IB | Attempt 2/10 for 7.5 pts. What is the value of the stock now