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TABLE 7.4 Value of Blue Skies Horizon (years) PV (dividends) PV (terminal price) = Value per Share 50 100 -230288 1 $2.68 $72.32 $75

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TABLE 7.4 Value of Blue Skies Horizon (years) PV (dividends) PV (terminal price) = Value per Share 50 100 -230288 1 $2.68 $72.32 $75 5.26 69.74 7.75 67.25 10 22.87 52.13 38.76 36.24 49.81 25.19 62.83 12.17 TRRRRRRR 75 75 75 75 75 75 73.02 1.98 75 Rework Table 7.4 for horizon years 1, 2, 3, and 10, assuming that investors expect the dividend and the stock price to increase at only 6% a year and that each investor requires the same 12% expected return. What value would Dritter place on the stock and what about Zehnte who has a 10-year horizon? (Do not round intermediate calculations. Round your answers to 2 decimal places.) Horizon (years) 1 PV (Dividends) PV (Terminal Price) Value per Share 2 3 10

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