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Staton-Smith Software is a new start-up company and will not pay dividends for the first five years of operation. It will then institute an annual
Staton-Smith Software is a new start-up company and will not pay dividends for the first five years of operation. It will then institute an annual cash dividend policy of $2.50 with a constant growth rate of 5%, with the first dividend at the end of year six. The company will be in business for twenty-five years total. What is the stocks price if an investor wants;
a) 10% return?
b) 15% return?
c) 40% return?
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