Question: It is expected that the dividend will grow at a variable rate during the first three years, after which the annual growth rate of the

It is expected that the dividend will grow at a variable rate during the first three years, after which the annual growth rate of the dividend will stabilize at 8% and remain constant for the foreseeable future. The most recent annual dividend per share is $2.21, and we expect it to grow to 20% in Year 1, 16% in Year 2, and 13% in Year 3, before the dividend drops to 8%. What is the stock price when the required rate of return is 14%?

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