Question

The Nearside Co. just paid a dividend of $1.55 per share on its stock. The dividends are expected to grow at a constant rate of 6 percent per year, indefinitely. Investors require a return of 14 percent on the stock. |

a. |
What is the current price? (Do not round intermediate
calculations and round your answer to 2 decimal places, e.g.,
32.16.) |

b. |
What will the price be in three years? (Do not round
intermediate calculations and round your answer to 2 decimal
places, e.g., 32.16.) |

c. |
What will the price be in 7 years? (Do not round
intermediate calculations and round your answer to 2 decimal
places, e.g., 32.16.) |

Answer #1

a)

b)

c)

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calculations and round your answer to 2 decimal places, e.g.,
32.16.)
Current price
$
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calculations and round your answer to 2 decimal places, e.g.,
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intermediate calculations and round your final answer to 2 decimal
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Current price
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