Talcville Farms just paid a dividend of $3.30 on its stock. The growth rate in dividends is expected to be a constant 5.5% per year indefinitely. Investors require a 15.5% return on the stock for the first three years, a 13.5% return for the next three years, and an 11.5% return thereafter. What is the current share price? (Do not round intermediate calculations. Round the final answer to 2 decimal places. Omit $ sign in your response.)
P0 = [{D0*(1+g)}/(1+r1)] + [{D0*(1+g)2}/(1+r1)2] + [{D0*(1+g)3}/(1+r1)3] + [{D0*(1+g)4}/{(1+r1)3(1+r2)}] + [{D0*(1+g)5}/{(1+r1)3(1+r2)2}] + [{D0*(1+g)6}/{(1+r1)3(1+r2)3}] + [{D0*(1+g)7}/{(rC-g)(1+r1)3(1+r2)3}]
= [{$3.30*(1+0.055)}/(1+0.155)] + [{$3.30*(1+0.055)2}/(1+0.155)2] + [{$3.30*(1+0.055)3}/(1+0.155)3] + [{$3.30*(1+0.055)4}/{(1+0.155)3(1+0.135)}] + [{$3.30*(1+0.055)5}/{(1+0.155)3(1+0.135)2}] + [{$3.30*(1+0.055)6}/{(1+0.155)3(1+0.135)3}] + [{$3.30*(1+0.055)7}/{(0.115-0.055)(1+0.155)3(1+0.135)3}]
= 3.01 + 2.75 + 2.51 + 2.34 + 2.17 + 2.02 + 35.51 = $50.33
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