Business Services, Inc. is expected to pay its first annual dividend of $0.80 per share three years from now. Starting in year six, the company is expected to start increasing the dividend by 2 percent per year. What is the value of this stock today at a required return of 12 percent?
A) $6.16
B) $6.47
C) $6.63
D) $7.22
E) $7.47
Correct Answer:
Verified
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