Calculate the expected dividend yield

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Problem - You buy a share of Bavarian Auto Parts Corp. stock for $33.44. You expect it to pay dividends of $3.01, $3.311, and $3.6421 in Years 1, 2, and 3, respectively, and you expect to sell it at a price of $44.51 at the end of 3 years.

Required -

a. Calculate the growth rate in dividends.

b. Calculate the expected dividend yield.

c. Assuming that the calculated growth rate is expected to continue, what is this stock's expected total rate of return?

Reference no: EM132793574

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