Darnell

One of the options is Delta Airlines. They have paid an annual dividend of $$4\mathrm{.}73$ for the past $25$ years and we expect them to continue this indefinitely. Assuming the market requires a$($n$)13\mathrm{.}5\%$ return from Delta, what is the value of a share of stock? $($Hint: Round intermediate calculations and answer to $2$ decimal places$)$

Jada Fuleky

Darnell

And what if we assumed they would start increasing their dividend by $3\mathrm{.}6\%$ per year? What would be a fair price to pay in that scenario? $($Hint: Round intermediate calculations and answer to $2$ decimal places$)$

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