Chapter 7 Question 15 Q15: Nonconstant Growth Metallica Bearings, Inc., is a young start-up company. No dividends will be paid on the stock over the next 9 years because the firm needs to plow back its earnings to fuel growth. The company will then pay a dividend of $23 per share 10 years from today and will increase the dividend by 5 percent per year thereafter. If the required return on this stock is 12 percent, what is the current share price? Input area: Years until first dividend Future dividend Dividend growth rate Required return Output area: Stock price in -1 years Current price