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$4252-46452$:FIN $310$ Finance LEC

$$\mathrm{.}50$ dividend in one year that grows at $5\%$ per year for an additional $2$ years

You can sell this share for $$63$ in three years $($after the dividend$)$

DEFINITE PERIODS, ZERO

GROWTH

You expect the following:

$$\mathrm{.}50$ dividend in one year, forever

You never plan on selling

$4.)$ INDEFINITE PERIODS, GROWING FOREVER

You expect the following:

$$\mathrm{.}50$ dividend in one year, forever, growing at $2\%$ per year

You never plan on selling

ADDITIONAL PROBLEMS INDEFINITE PERIODS, INCONSISTENT GROWTH

$$\mathrm{.}50$ dividend at the beginning of year $5$

This dividend grows at $5\%$ during years $5$ and $6$

After that it grows at $2\%$ forever

ANSWER TO ADDITIONAL PROBLEM

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