Question: Simon, Co . just paid a $ 0 . 8 5 annual dividend. The company has a policy whereby the dividend increases by 2 %

Simon, Co. just paid a $0.85 annual dividend. The company has a policy whereby the dividend increases by 2% annually. You would like to purchase 500 shares of stock in this firm but realize that you will not have the funds to do so for another two years. If you desire a 12.50% rate of return, how much should you expect to pay for 500 shares when you can afford to buy this stock?

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