Question 7 Ceebros Builders is expanding very fast and expects to grow at a rate of 25% for the next four years. The company recently paid a dividend of $3.60 but does not expect to pay any dividends for the next three years. In Year 4, management intends to pay a $5 dividend and thereafter to increase its dividend at a constant rate of 6% per year. The required rate of return on such stocks is 20%. What is the value of the stock today? Would todays stock value be affected by the length of time you intend to hold the stock?