Company RTZ has a unique dividend policy. The company anticipates paying a dividend of $3 one year from today, $4 two years from today, and $5 three years from today. After the third year, the company anticipates increasing the dividend at a rate of 3% per year, indefinitely. If the return required by shareholders is 15%, then the price of the stock should be 0 1 2 3 3% 3% 5 | $3.00 4 --- 3% -....... $4.00 $5.00 Step 1: Present value of non-constant dividends: Step 2: Horizon Value at year 3: De*(1+g) = k-g Step 3: Present value of Horizon stock value: Step 4: Present Value of the stock today (Remember add all Present Values only)