bintalsham
Nov 10, 2008, 02:21 PM
Simplicity is a relatively new firm that appears to be on the road to great success. The
company paid their first annual dividend yesterday in the amount of $0.15 a share. The company plans to double each annual dividend payment for the next four years. After that time, they are planning on paying a constant dividend of $2.50 per share indefinitely. What is one share of this stock worth today if the market rate of return on similar securities is 13.45 percent?
I know that at the first four dividends will be .30 , .60, 1.20, and 2.40
Then I am lost
company paid their first annual dividend yesterday in the amount of $0.15 a share. The company plans to double each annual dividend payment for the next four years. After that time, they are planning on paying a constant dividend of $2.50 per share indefinitely. What is one share of this stock worth today if the market rate of return on similar securities is 13.45 percent?
I know that at the first four dividends will be .30 , .60, 1.20, and 2.40
Then I am lost





