Problem:
The Carleton Company has just paid a dividend of $2 per share, which is expected to grow at 8 percent per year for the next three years, and then at 4 percent per year forever.Investors require a return of 12 percent for the next three years, and then 9 percent per year forever.
Required:
Question: What is the current share price for Carleton stock?
Note: Provide support for rationale.