Computation of current stock price

Reference no: EM13825982

Problem:

Your company paid a dividend of $2.00 last year. The growth rate is expected to be 50% for 1 year, 10% the next year, 5% for the following year, and then the growth rate is expected to be a constant 1% per year thereafter. The required rate of return is 10%. What is the current stock price?

A. $27.74

B. $44.78

C. $37.27

D. $36.03

Additional Information:

This question is basically belongs to the Finance as well as it is about computation of current stock price.

Reference no: EM13825982

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