How much are you willing to pay to buy one share

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Question: Clothes 4 U announced today that it will begin paying annual dividends next year. The first dividend will be $0.18 a share. The following dividends will be $0.25, $0.35, $0.50, and $0.75 a share annually for the following 4 years, respectively. After that, dividends are projected to increase by 5 percent per year. How much are you willing to pay to buy one share of this stock today if your desired rate of return is 6.5 percent?

Reference no: EM131956141

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