Q.3 UBL paid Rs. 1.50 per share dividend yesterday. You expect the dividend to grow steadily at a rate of 4 percent per year.

Required:

1. What is the expected dividend in each of the next 3 years?
2. If the discount rate for the stock is 15 percent, at what price will the stock sell?
3. What is the expected stock price 3 years from now?

d) If you buy the stock and plan to hold it for 3 years:

1. What payments will you receive?
2. What is the present value of those payments?