Question $10$

Triton, Inc., expects to grow at a rate of A percent for the next five years and then settle to a constant$-$growth rate of B percent. The

company recently paid a dividend of $C.$ The required rate of return is $D$ percent.

$($a$)$ Find the present value of the dividends only over the five years of the rapid growth, if the dividends grow at the same rate as the

company.

$($b$)$ What is the value of the stock at the end of year $5?$

Workings: