Microsoft paid the following annual dividends over the last 5 years:

Year Dividend

2012 0.29

2013 0.2987

2014 0.3077

2015 0.3169

2016 0.3264

The next dividend is expected 12 months from now. Attempt 1/10 for 9 pts.

Part 1 Based on the historical dividends, what is the expected growth rate of dividends? Submit Attempt 1/10 for 9 pts.

Part 2 If you can expect a return of 8% from investments of similar risk, what is the intrinsic value of the stock? Submit Attempt 1/10 for 9 pts.

Part 3 If you can expect a return of 14% from investments of similar risk, what is the intrinsic value of the stock?