Today is March 20, 2013. SweetApple Inc has just paid its annual dividend of $10.40. Analyst predict that the next annual dividend will be $20, then $ 30 and after that the dividends will be growing at 10% forever. Investors required rate of return is 20%. a. What is the current share price? b. What is the expected dividend yield for this year? c. What is the expected Apple's price one year from now? (Hint - what are expected capital gains for this year?) $ 10.40 $ 20.00 Past Dividend2013 Dividend2014 Dividend2015 growth rate Required return $ 30.00 10% 20% a. What is the current share price? Dividend2016 Price2015 period Year 1 (Dividend+Price) PV 2014 2015 2 Current Price If you could not find price in a., for b. and c. you may assume current price of $300. b. What is the expected dividend yield for this year? Price Dividend Dividend Yield c. What is the expected Apple's price one year from now? (Hint - what are expected capital gains for this year?) Expected Capital Gains Expected Price in one year Today is March 20, 2013. SweetApple Inc has just paid its annual dividend of $10.40. Analyst predict that the next annual dividend will be $20, then $ 30 and after that the dividends will be growing at 10% forever. Investors required rate of return is 20%. a. What is the current share price? b. What is the expected dividend yield for this year? c. What is the expected Apple's price one year from now? (Hint - what are expected capital gains for this year?) $ 10.40 $ 20.00 Past Dividend2013 Dividend2014 Dividend2015 growth rate Required return $ 30.00 10% 20% a. What is the current share price? Dividend2016 Price2015 period Year 1 (Dividend+Price) PV 2014 2015 2 Current Price If you could not find price in a., for b. and c. you may assume current price of $300. b. What is the expected dividend yield for this year? Price Dividend Dividend Yield c. What is the expected Apple's price one year from now? (Hint - what are expected capital gains for this year?) Expected Capital Gains Expected Price in one year