Question $10(10$ points$)$

Valuing a share of a stock $($P$)$ that pays a dividend that grows at a constant rate $"g"$ in the future:

Assume the company now pays dividend $($D$0)$ of $$0\mathrm{.}50,$ and it is expected to grow at $($g$)5\%$ per year.

The required rate of return $($R$)$ is $10\%$ on assets with this type of risk.

What is the Price for a share of this stock?

$$42\mathrm{.}30$

$$10\mathrm{.}50$

$$50\mathrm{.}15$

None of the above