Compute the expected dividend for the second year

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Ted McKay has just bought the common stock of Carla Vista Corp. Management of Carla Vista expects the company expects to grow at the following rates for the next three years: 45 percent, 40 percent, and 30 percent. Last year the company paid a dividend of $2.30. Assume a required rate of return of 11 percent.

Dividend for the first year$3.34

Problem 1: Compute the expected dividend for the second year?

Reference no: EM132841196

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