Problem 1 Intro A stock just paid an annual dividend of $3.65. The dividend is expected to grow by 9% per year for the next 5 years. It will then grow by 1% per year forever. The required rate of return is 11%. 18 Attempt 1/10 for 10 pts. Part 1 What is the dividend in year 5? 5.61597 Correct A B D E F G H - 1 0.09 2 Initial growth Forever growth Required return 0.01 3 0.11 4 5 Year 0 1 2 3 4 5 6 Dividend 3.65 3.979 4.337 4.727 5.15 5.62 =F6*(1+$B1) "Attempt 1/10 for 10 pts. Part 2 What is the terminal value (Ps)? Attempt 1/10 for 10 pts. Part 2 What is the terminal value (P5)? 56.72 Correct A B D E G H 1 Initial growth 0.09 2 0.01 Forever growth Required return 3 0.11 4 5 Year 0 1 2 3 4 5 6 Dividend 3.65 3.979 4.337 4.727 5.15 5.62 =F6*(1+$B1) =G6* 56.72 (1+B2)/(B3-B2) 7 P5 Part 3 IB | Attempt 1/10 for 10 pts. What is the value of the stock? 0+ decimals Submit