Problem 9-23 Present value [LO9-3]

Jack Hammer invests in a stock that will pay dividends of $3.10 at the end of the first year; $3.50 at the end of the second year; and $3.90 at the end of the third year. Also, he believes that at the end of the third year he will be able to sell the stock for $60.

What is the present value of all future benefits if a discount rate of 10 percent is applied? Use Appendix B for an approximate answer, but calculate your final answer using the formula and financial calculator methods. (Do not round intermediate calculations. Round your final answers to 2 decimal places.)