A Corporation announced of its plans to pay: $3 dividend per share in 1 year, $6...

A Corporation announced of its plans to pay:

$3 dividend per share in 1 year,

$6 dividend per share in 2 years,

$9 dividend per share in 3 years,

after which the dividend will be increasing at a constant annual growth rate of 5 percent. The rate of return for this company is 12%. Calculate the value of one share of its stock.

Part of the calculation will be finding the Present Value of a

ordinary annuity
annuity due
regular perpetuity
growing perpetuity

…with the first dividend being

$3
$6
$9
$91.51
$98.08
$102.50
$109.96
$122.15

(Increase decimal places for any intermediate calculations, from the default 2 to 6 or higher. Only round your final answer to TWO decimal places: for example, 100.23.) The final numerical answer to this problem is:

Expert Solution

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jeff jeffy answered 3 years ago

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