Question

please complete all parts to the problem including the graph section. added extra photos of the answer choices to choose from so its easier.

4. Expected dividends as a basis for stock values The following graph shows the value of a stock's dividends over time. The stock's current dividend is $1.00 per share, and dividends are expected to grow at a constant rate of 2.70% per year. The intrinsic value of a stock should equal the sum of the present value (PV) of all of the dividends that a stock is supposed to pay in the future, but many people find it difficult to imagine adding up an infinite number of dividends. Calculate the present value (PV) of the dividend paid today (D.) and the discounted value of the dividends expected to be paid 10, 20, and 50 years from now (D1, D2, Dso). Assume that the stock's required return() is 8.40%. Note: Carry and round the calculations to four decimal places Dividend's Expected Future Value Dividend's Expected Present Value Time Period Now End of Year 10 End of Year 20 End of Year 50 Using the orange curve (square symbols), plot the present value of each of the expected future dividends for years 10, 20, and 50. The resulting curve will illustrate how the PV of a particular dividend payment will decrease depending on how far from today the dividend is expected to be received. Note: Round each of the discounted values of the dividends to the nearest tenth decimal place before plotting it on the graph. You can mouse over! the points in the graph to see their coordinates.

Answer 1

SEE THE IMAGE. ANY DOUBTS, FEEL FREE TO ASK. THUMBS UP PLEASE

STATS -Microsoft Excel (Product Activation Failed) Page Layout Formulas File Home Insert Data Review View Add-Ins Z AutoSum- Cut A A Wrap Text Calibri 11 General Copy Fill Merge & Center Insert Delete Format Paste B I U A 000 Conditional Format Cell Sort & Find & % Format Painter Clear Filter Select Formatting as Table Styles Number Styles Clipboard Font Alignment Cells Editing fox AU1 ВЕ AU AV AX AY AZ BA BB BC BD BE BF BG BH AW 1 3 current dividend 4 1 5 DISCOUNT RATE = 6 GROWTH RATE 2.70% 8.40% Dividend's expected Time period 7 expected dividend's Future value present value 9 now End of year 10 1.3053/(1+0.084)^10 = 1*(1 0.027)^10 1.3053 10 0.5827 End of year 20 1.7038/(1+0.084)^20 1*(1 0.027)^20 11 1.7038 0.3395 End of year 50 3.7890/(1+0.084)^50 = 1*(1 0.027)A50 = 3.7890 0.0672 12 13 14 15 16 17 18 19 4,0000 corr REGRESSION HYPOTH MEAN STDV EMV assignment Sheet2 DEAR PV FV DIVIDEND COV TIME SERIES TREND freg MATRIX INTERVAL, NORMAL range CAMERA 130% ( ) erences W 03:21 E 0 ENG 29-10-2019

STATS -Microsoft Excel (Product Activation Failed) Page Layout Formulas File Home Insert Data Review View Add-Ins E AutoSum Cut AC Wrap Text Calibri 11 General Copy Fill B IU Merge & Center Paste Conditional Format Cell Insert Delete Format Sort & Find & Filter Select % Format Painter Clear Formatting as Table Styles Clipboard Font Alignment Number Styles Cells Editing fox B136 ВВ AV AW AX AY AZ ВА BB BC BD BE BF BG BH BI 18 19 4.0000 20 3.7890 3.5000 21 22 3.0000 23 year future dividend present value of dividend future 1.3053 0.5827 24 10 2.5000 dividend 1.7038 25 20 0.3395 2.0000 26 50 3.7890 0.0672 1.7038 27 present value of 1.5000 dividend 1.0000 29 0.5827 30 0.3395 0.5000 31 0.0672 32 0.0000 33 0 10 20 30 40 50 60 34 YEARS 35 36 assignment ΗΥΡΟΤΗ 4 HYPOTHI 130% () EMV Sheet2 Cov TREND freq MATRIX DEAR MEAN STDV corr REGRESSION PV FV DIVIDEND TIME SERIES range CAMERA INTERVAL, NORMAL erences W 03:21 ENG 29-10-2019 BA DIVIDEND