Question: Please help me answer question (b), including the working step and formula. Thanks. (b) Recent dividend distributed RM1. Suppose a firm is expected to increase

Please help me answer question (b), including the working step and formula. Thanks.

Please help me answer question (b), including the working step and formula.

(b) Recent dividend distributed RM1. Suppose a firm is expected to increase dividends by 20% in one year and by 15% in two years. After that, dividends will increase at a rate of 5% per year indefinitely. If the required return is 20%, calculate the stock. (8 marks)

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