year 6, the dividends begin to grow at a consta new constant growth rate which will continue into the future. The discount or take the present ue of P6 and all dividend payments and then sum them to arrive at the current bond price P0. case do not copy the hints I gave you but you are welcomed to write your own or type your own, I am sure it will be much more creative and better looking than mine. P6= DIV6 (1+ g) = DIV (R-g). Po= = DIV (1 + R) +...+ DIV5 (1 + R)5 + DIV6+ P6 (1 + R)6 our answer for the horizon value stock price, at period 6, (when growth of dividends changes o a constant rate) P6, should be between $183 and $186. Your answer for Po should be between 162 and $163. Again, if I don't see work, I cannot not give credit, (I love eraser marks, for it allows me to see you were working hard). Continued on the next page... 3