Finally, assume that Temp Forces earnings and dividends are expected to decline by a constant 6% per

Question:

Finally, assume that Temp Force’s earnings and dividends are expected to decline by a constant 6% per year forever, that is, g = −6%. Why would anyone be willing to buy such a stock, and at what price should it sell? What would be the yield and capital gains yield in each year?

Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...