Question: Problem 7-8 Dividend Discount Model (LO2) Rework Table 74 for horizon years 1. 2. 3. and 10, assuming that investors expect the dividend and the

and the stock price to increase at only 6% a year and

Problem 7-8 Dividend Discount Model (LO2) Rework Table 74 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 $3.90 at the end of the first year. (Do not round intermediate calculations. Round your answers to 2 decimal places.) Value per PV (Dividends) PV (Terminal Price) Share Horizon (years) 1 2 3 10 TABLE 7.4 Value of Blue Skies + Horizon (years) 1 2 3 10 20 30 50 100 PV (dividends) $2.68 5.26 7.75 22.87 38.76 49.81 6283 73.02 PV (terminal price) $72.32 69.74 6725 52.13 36:24 25.19 12.17 1.98 Value per Share $75 75 75 75 75 75 75 75 Problem 7-8 Dividend Discount Model (LO2) Rework Table 74 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 $3.90 at the end of the first year. (Do not round intermediate calculations. Round your answers to 2 decimal places.) Value per PV (Dividends) PV (Terminal Price) Share Horizon (years) 1 2 3 10

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