Zero-growth, constant dividends: Draw a timeline of a stock that pays a fixed stream of dividend of $10 per share forever and compute the present value (or price). Assume the required rate of return of 15%.

Constant growth dividends: Draw a timeline for a stock that paid a dividend of $10 today (year 0) and grow dividends at 10% every year. The required rate of return is 15%. We use formula #1 to compute the present value of such cash flows. Note: Do not include paid dividends to compute the price. The price of a stock only incorporates expected future dividends.