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BONUS: Staton - Smith Software is a new up - start company and will not pay dividends for the first five years of operation. It

BONUS: Staton-Smith Software is a new up-start company and will not pay dividends for the first five years of operation. It will then institute an annual cash dividend policy of $2.50 with a constant growth rate of 5% with the first dividend at the end of year six. The company will pay dividends for 20 years. What is the price of this stock if an investor wants a 40% return?
A.1.46
B.1.53
C.1.20
D.1.32
E.1.25

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