Question: Suppose Kalani bought 150 shares in Talendula llp. 8 years ago and plans to sell it in 5 years from today. Since she bought the stock, she has collected dividends of $1.14, $2.45, and $1.97 per share. Over the next 5 years she plans to collect dividends of $2.48 and $2.27 per share. Find the annualized holding period return on her investment if she expects to sell the stock for $33.77 in 5 years. Is this a realized return or expected return?

Answer (Provided by answer sheet):

To find the price we can handle this problem as if it were a combined cash flows problem. We have three single payments and one deferred annuity to deal with. lets start by getting all the single payments back to time zero:

The holding period return for the full period from 8 years ago to 5 years in the future is then 3.7% From here we need to annualize the return, this will tell us on average what constant return we received each year over the full holding period.

My question is:

How did they find the 44.33 and the 1.89 in the holding period return formula?