# Question

OK Natural Foods' current dividend is $5.00. You expect the growth rate to be 0 percent for years 1 to 5, and 2 percent for years 6 to infinity. The required rate of return on this firm’s equity is 10 percent. Determine the following:

a. The expected dividend at the end of year 5

b. The expected dividend at the end of year 6

c. The expected price of the stock at the end of year 5 (immediately after the year 5 dividend)

d. The price of the stock today

a. The expected dividend at the end of year 5

b. The expected dividend at the end of year 6

c. The expected price of the stock at the end of year 5 (immediately after the year 5 dividend)

d. The price of the stock today

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