You are considering buying stock and require a rate of return of 12%. If you expect the dividend to be $1.25 for years 1-3, $1.50 in year 4 and $1.75 in year 5 with an expected selling price at that time of $67, then what is the most you should pay today?

Question

You are considering buying stock and require a rate of return of 12%.   If you expect the dividend to be $1.25 for years 1-3, $1.50 in year 4 and $1.75 in year 5 with an expected selling price at that time of $67, then what is the most you should pay today? ​

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The Answer of You are considering buying stock and require a rate of return of 12%.   If you expect the dividend to be $1.25 for years 1-3, $1.50 in year 4 and $1.75 in year 5 with an expected selling price at that time of $67, then what is the most you should pay today? ​

You Are Considering Buying Stock and Require a Rate of Return