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Assume that l is now January 1, 2017. Wayne-Martin Electric Inc. (WME) has just developed a solar panel capable of generating 200% more electricity than
Assume that l is now January 1, 2017. Wayne-Martin Electric Inc. (WME) has just developed a solar panel capable of generating 200% more electricity than any other solar panel currently on the market. As a result. WME is expected to experience a 15% annual growth rate for the next b years. Other firms will have developed comparable technology at the end of b years, and WMfc's growth rate will slow to 4% per year indefinitely. Stockholders require a return of 12% on WME's stock. The most recent annual dividend (D_0), which was paid yesterday. was $1.95 per share. a. Calculate WMFs expected dividends for 2017, 2018, 2019. 2020 and 2021. Round your answers to the nearest cent. Do net round you.' intermediate calculations. D2017 = $ D2018 = $ D2019 =$ D2020 = $ D2021 = $ b Calculate the value of the stuck today, P-0. Proceed by finding the present value of the dividends expected at the end of 2017, 2018, 2019, 2020 and 2021 plus the present value of the stuck price that should exist at the end of 2021. Hie year-end
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