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Your company has the following expected dividends over the next 6 years: $2.00,$2.40,$3.20, $3.60,$4.20, and $4.41. Note that starting in Year 5 , dividends will
Your company has the following expected dividends over the next 6 years: $2.00,$2.40,$3.20, $3.60,$4.20, and $4.41. Note that starting in Year 5 , dividends will begin to grow at a constant, long-run sustainable growth rate of 5 percent (D6=$4.201.05=$4.41, etc. ). Further, the riskfree rate is 4.0 percent, the Risk Premium on the Market is 6.0 percent, and the company has a beta of 1.30 Calculate the current price of this stock at Year 0. $52.72 $43.75 $37.29 $40.27 $47.84
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