As Aa 3. Expected dividends as a basis for stock values The following graph shows the value of a stock's dividends qver time. The stock's current dividend is $1.00 per share and dividends are expected to grow at a constant rate of 4.50% per year. The intrinsic value of a stock should equal the sum of the present value (PV) of all of the dividends that a stock is suppesed to pay in the future, but many people find it difficult to imagine adding up an infinite number of dividends Calculate the present value (P) of the dividend paid today (Da) and the discounted value of the dividends expected to be paid 10 and 20 years from now (Da and D) Assume that the stock's required return (r.) is 5.40 % . Note: Carry and round the caloulations to four decimal places Time Peried Dividend's Expected Expected Dividend's Future Value Present Value Now End of Year 10 End of Year 20 End of Year 50 Using the blue ourve (nde symbols) piot the Rhure vale of each of the expeted ure dvdends for years 0 20 and 50 The resuing curve wit stre how the y of a awtoar diend peyment wi e dpending on ho far rom today the dvidend is expected to be recved Nete und each of he dcouned valu en the grah of the of dvdends to the neret th cmeuse over the ponts in he grash o soe thrcordinates mal place before plng Epeed t A 22 Aa ade & 2 3 5 6 7 Q W R T tab Y A D F G caps lock X V shift B alt control Option T LL A4 N