Chapter 7: Net Present Value and Capital Budgeting

Given an interest rate of 10 percent per year, what is the value at the end of year 5 of a perpetual stream of $120 annual payments starting at the end of year 9? Harris, Inc., paid a $3 dividend yesterday. If the firm raises its dividend five percent every year and the appropriate discount rate is 12 percent, what is the price of Harris stock? ................
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