Question: hold it for 3 years and then sell it . The appropriate discount rate is 9 % . a . Find the expected dividend for
hold it for years and then sell it The appropriate discount rate is
a Find the expected dividend for each of the next years; that is calculate and Note that $ Do not round intermediate calculations. Round your answers to the nearest cent.
$
$
$
Round your answer to the nearest cent.
$
of $ Do not round intermediate calculations. Round your answer to the nearest cent.
$
$
e Use equation below to calculate the present value of this stock.
widehat
Assume that and that it is constant. Do not round intermediate calculations. Round your answer to the nearest cent.
$
would produce the same value of widehat
would produce a different value of widehat
III. Yes. The value of the stock is dependent upon the holding period due to the fact that the value is determined as the present value of all future expected dividends.
IV No The value of the stock is not dependent upon the holding period unless the growth rate remains constant for the foreseeable future.
V Yes. The value of the stock is dependent upon the holding period as long as the growth rate remains constant for the foreseeable future.
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