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Delco Stores Inc is expected to pay an annual dividend next year of $3.10 a share, a dividend in Year 2 of $3.22, and a

  1. Delco Stores Inc is expected to pay an annual dividend next year of $3.10 a share, a dividend in Year 2 of $3.22, and a dividend in Year 3 of $3.34. Thereafter dividends are expected to grow at a constant rate of 1.25 percent annually. What is the price of Delco Stores stock given a required return of 11 percent.

    A.

    $41.83

    B.

    $30.45

    C.

    $37.58

    D.

    $45.91

    E.

    $33.21

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