Weston Corporation just paid a dividend of $4 a share (i.e., D0 = $4). The dividend...

Weston Corporation just paid a dividend of $4 a share (i.e., D₀ = $4). The dividend is expected to grow 10% a year for the next 3 years and then at 3% a year thereafter. What is the expected dividend per share for each of the next 5 years? Round your answers to two decimal places.

D₁ = $
D₂ = $
D₃ = $
D₄ = $
D₅ = $

Expert Solution

D0 = $4

D1 = D0 *(1+g)
D1 = $4 *(1+0.10)
D1 = $4.40

D2 = D1 *(1+g)
D2 = $4.40 * (1+0.10)
D2 = $4.84

D3 = D2 * (1+g)
D3 = $4.84 * (1+0.10)
D3 = $5.32

D4 = D3 *(1+g)
D4 = $5.32 * (1+0.03)
D4 = $5.48

D5 = D4 * (1+g)
D5 = $5.48 * (1+0.03)
D5 = $5.64

jeff jeffy answered 2 years ago

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