How to solve

Problem $7-8$ Dividend Discount Model $($LO$2)$

Rework Table $7\mathrm{.}4$ for horizon years $1,2,3,$ and $10,$ assuming that investors expect the dividend and the stock price to increase at only $6\%$ a year and that each investor requires the same $12\%$ expected return. The company will pay a dividend of $$1\mathrm{.}20$ at the end of the first year.

What value would an investor place on the stock?

Note: Do not round intermediate calculations. Round your answers to $2$ decimal places.

$\backslash$table$[[\backslash$table$[[$Horizon$],[($years$)]],\backslash$table$[[$PV$],[($Dividends$)]],\backslash$table$[[$PV $($Terminal$],[$Price$)]],\backslash$table$[[$Value per$],[$Share$]]],[1,,,],[2,,,],[3,,,],[10,,,]]$

TABLE $7\mathrm{.}4$ Value of Blue Skies.

$\backslash$table$[[$Horizon $($years$),$PV $($dividends$),\backslash$table$[[$PV $($terminal$],[$price$)]],$Value per Share$],[1,$$$2\mathrm{.}68,$$$72\mathrm{.}32,$$$75$