You expect a share of stock to pay dividends of $1.20, $1.35, and $1.70 in each...
You expect a share of stock to pay dividends of $1.20, $1.35, and $1.70 in each of the next 3 years. You believe the stock will sell for $16.00 at the end of the third year.
a. What is the stock price if the discount rate
for the stock is 20%? (Do not round intermediate
calculations. Round your answer to 2 decimal places.)
b. What is the dividend yield for year 1?
(Do not round intermediate calculations. Enter your answer
as a percent rounded to 2 decimal places.)
c. What will be the dividend yield at the start of year 2? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.)
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