Quiz 1 covers chapter 1 and 3 - San Francisco State University

By observing this constant growth rate of dividends, you can use the dividend growth model to calculate the stock price at year 3, which is P3=Div4/(r-g), where r=13% and g =5%. Then the current stock price is the present value of three dividends received in each year in the next three years, and the stock price at year 3. Po = = 3.54 + ................
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