The Stopperside Wardrobe Co. just paid a dividend of $1.95 per share on its stock. The dividends

Question:

The Stopperside Wardrobe Co. just paid a dividend of $1.95 per share on its stock. The dividends are expected to grow at a constant rate of 6 percent per year indefinitely. If investors require a 11 percent return on The Stopperside Wardrobe Co. stock, what is the current price? What will the price be in three years? In 15 years?

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...

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