Question: Company A has just distributed a dividend (D 0 ), and expects profits and dividends to increase by 0% in year two, by 5% in

Company A has just distributed a dividend (D₀), and expects profits and dividends to increase by 0% in year two, by 5% in year three and by 10% in year four and after. Company A has a required return of 15%, and the stock is currently selling for P₀= 78.78. What is the expected amount to distribute as a dividend next year (D₁)?

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