The common shares of Unicorp. are forecast to pay annual dividends of $2 at the end of each of the next five years, followed by dividends of $3 per year in perpetuity. What is the fair market value of the shares if the market requires a 8% annually compounded rate of return on shares having a similar degree of risk?

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The Answer of The common shares of Unicorp. are forecast to pay annual dividends of $2 at the end of each of the next five years, followed by dividends of $3 per year in perpetuity. What is the fair market value of the shares if the market requires a 8% annually compounded rate of return on shares having a similar degree of risk?

The Common Shares of Unicorp