Question

Weston Corporation just paid a dividend of $3.75 a share (i.e., D0 = $3.75). The dividend...

Weston Corporation just paid a dividend of $3.75 a share (i.e., D0 = $3.75). The dividend is expected to grow 8% 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=

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Homework Answers

Answer #1
d1= d0 * ( 1 + growth rate)
3.75 * (1 + 8%)
4.05
4.05 (Rounded Off)
d2= d1 * ( 1 + growth rate)
4.05 * (1 + 8%)
4.374
4.37 (Rounded Off)
d3= d2 * ( 1 + growth rate)
4.374 * (1 + 8%)
4.72392
4.72 (Rounded Off)
d4= d3 * ( 1 + growth rate)
4.72392 * (1 + 3%)
4.8656376
4.87 (Rounded Off)
d5= d4 * ( 1 + growth rate)
4.8656376 * (1 + 3%)
5.011606728
5.01 (Rounded Off)
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