Question

Thress Industries just paid a dividend of $1.75 a share (i.e., D₀ = $1.75). The dividend is expected to grow 8% a year for the next 3 years and then 12% a year thereafter. What is the expected dividend per share for each of the next 5 years? Do not round intermediate calculations. Round your answers to the nearest cent.

D₁ = $  

D₂ = $  

D₃ = $  

D₄ = $  

D₅ = $  

Answer 1

Year	CF	Formula	Calculation
1	$      1.89	D0(1+g)	1.75*1.08
2	$      2.04	D1(1+g)	1.89*1.08
3	$      2.20	D2(1+g)	2.04*1.08
4	$      2.47	D3(1+g)	2.20*1.12
5	$      2.77	D4(1+g)	2.47*1.12

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