Question: Your assistant has estimated (forecast) the dividends expected for the common stock of R&L, Inc. over the next three years to be $.38, $1.42, and

Your assistant has estimated (forecast) the dividends expected for the common stock of R&L, Inc. over

the next three years to be $.38, $1.42, and $3.62, respectively. Thereafter, dividend payments are estimated to grow at 2.50% per year.

You are considering the purchase of R&L stock. If you require a 13.25% rate of return, what is the value per share of R&L, Inc. common stock?

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