Problem

Nonconstant Dividends. Apocalyptica Corporation is expected to pay the following dividends...

Nonconstant Dividends. Apocalyptica Corporation is expected to pay the following dividends over the next four years: $5, $16, $21, and $2.80. Afterwards, the company pledges to maintain a constant 5 percent growth rate in dividends, forever. If the required return on the stock is 11 percent, what is the current share price?

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Solutions For Problems in Chapter 7