What is the expected dividend in each of the next years


Integrated Potato Chips paid a $1 per dividend yesterday. You expect the dividend to grow steadily as a rate of 4% per year.

A) What is the expected dividend in each of the next 3 years?

B) If the discount rate for the stock is 12%, at what price will the stock sell?

C) What is the expected stock price 3 years from now

D) If you buy the stock and plan to hold it for 3 years, what payments will you receive?

What is the present value of those payments?

Compare your answer to B

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Finance Basics: What is the expected dividend in each of the next years
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