Stanley Corp. paid a dividend of $3.00 in the year that just ended. Analysts expect that dividends will grow by 30% this year, 20% in the second year, and by 10% in the third year. After the third year they plan to maintain a constant retention rate of 50%. Analysts forecast that the return on new equity investment for Stanley Corp. after its third year would be 10%. The required rate of return on Stanley Corps stock is 9%.

Note: Do not round intermediate calculations.

What are the values of the expected dividends for Stanley Corp. during the first three years?

D1=$3.30, D2=$4.29 and D3=$5.148.

D1=$3.00, D2=$3.90 and D3=$4.68.

D1=$3.90, D2=$3.60 and D3=$3.30.

D1=$3.90, D2=$4.68 and D3=$5.148.