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S In doing a five-year analysis of future dividends, the Dawson Corporation is considering the following two plans. The values represent dividends per share.
S In doing a five-year analysis of future dividends, the Dawson Corporation is considering the following two plans. The values represent dividends per share. Use Appendix B for an approximate answer but calculate your final answer using the formula and financial calculator methods. Year 12345 Plan A $ 1.40 Plan B $ 0.40 1.40 2.10 1.40 0.40 1.90 1.90 4.00 1.50 a. How much in total dividends per share will be paid under each plan over five years? Note: Do not round intermediate calculations and round your answers to 2 decimal places. Plan A Plan B Total Dividends b-1. Mr. Bright, the Vice-President of Finance, suggests that stockholders often prefer a stable dividend policy to a highly variable one. He will assume that stockholders apply a lower discount rate to dividends that are stable. The discount rate to be used for Plan A is 9 percent; the discount rate for Plan B is 13 percent. Compute the present value of future dividends. Note: Do not round intermediate calculations and round your answers to 2 decimal places.
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