B C Chapter 7 Question 1 E F H J K L M Fowler, Inc., just paid a dividend of $1.95 per share on its stock. The dividends are expected to grow at a constant rate of 4 percent per year, indefinitely. If investors require a return of 10.5 percent on this stock, what is the current price? What will the price be in three years? In 15 years? Input area: Dividend paid Dividend growth rate Required return Year for price Year for price Year for price $ 1.95 4.0% 10.5% 0 3 15 Output area: To calculate dividends, must use FV fx for credit. To calculate stock prices, formula entry is required Dividend in one year Price at Year 0 $ 25.85 Dividend in 4 years Price at Year 3 $ 29.48 Dividend in 16 years Price at Year 15 $ 56.52