Question: E-Eyes.com just issued some new preferred stock. The issue will pay an annual dividend of $7 in perpetuity, beginning 11 years from now. If the

E-Eyes.com just issued some new preferred stock. The issue will pay an annual dividend of $7 in perpetuity, beginning 11 years from now. If the market requires a 9 percent return on this investment, how much does a share of preferred stock cost today?

E-Eyes.com. just paid a dividend of $1.55 per share. The dividends are expected to grow at 30 percent for the next 7 years and then level off to a growth rate of 5 percent indefinitely. If the required return is 14 percent, what is the price of the stock today?

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