Integrated Potato Chips just paid a $2.8 per share dividend. You expect the dividend to grow steadily at a rate of 4% per year.

a. What is the expected dividend in each of the next 3 years?

b. If the discount rate for the stock is 12%, at what price will the stock sell today?

c. What is the expected stock price 3 years from now?

Expected Dividend Year 1 Year 2 Year 3 Current price Future price