Temp Corp. just paid a $2.25 dividend. Because of a new invention, the dividend is expected to

Fantastic news! We've Found the answer you've been seeking!

Question:

Temp Corp. just paid a $2.25 dividend. Because of a new invention, the dividend is expected to rise at a 35% rate for two years, then a 15% rate for two more years. Then, competition will flood the market and the firm will pay a $32 liquidating dividend and cease to exist. If you require a 12% return to compensate for the risk, what is a share of the stock worth?

g₁

g₂

g₃

g₄

D₀

D₁

D₂

D₃

D₄

D₅

P₀