make an Excel spreadsheet to organize your answers to the following problem, and submit your Excel file as an attachment by clicking on the appropriate button on this page.

A company is considering the following two dividend policies for the next five years.

YearPolicy #1Policy #21$4.00$6.002$4.00$2.703$4.00$5.004$4.00$3.105$4.00$3.20

Part 1: How much total dividends per share will the stockholders receive over the five year period under each policy?

Part 2: If investors see no difference in risk between the two policies, and therefore apply a 9.4% discount rate to both, what is the present value of each dividend stream?

Part 3: Suppose investors see Policy #2 as the riskier of the two. And they therefore apply a 9.4% discount rate to Policy #1 but a 14% discount rate to Policy #2. Under this scenario, what is the present value of each dividend stream?

Part 4: What conclusions can be drawn from this exercise?