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John Doe plc has just paid a dividend of $2.45 per share. The company will increase its dividend by 20 per cent next year and

John Doe plc has just paid a dividend of $2.45 per share. The company will increase its dividend by 20 per cent next year and will then reduce its dividend growth rate by 5 percentage points per year until it reaches the industry average of 5 per cent dividend growth, after which the company will keep a constant growth rate forever. If the required return on John Doe shares is 11 per cent, what will a share of equity sell for today?  

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