Consider a stock that will pay a $2 dividend per year for 10 years (from t=1...

Consider a stock that will pay a $2 dividend per year for 10 years (from t=1 till t=10) after which the dividends are expect to increase at the constant growth rate of 3% per year (so, at=11 the dividend will be 2*1.03=$2.06, at t=12 it will be 2.06*1.03, etc. ) and the required return on the stock is 11%

Find the stock price today, the capital gain yield during the first year, the dividend yield during the 15th year

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SEE THE IMAGE. ANY DOUBTS, FEEL FREE TO ASK. THUMBS UP PLEASE

jeff jeffy answered 1 year ago

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