Stock price and dividend problem-texas corporation

Reference no: EM1330840

Texas Corporation stock pays a dividend on every July 15. In 2008: the dividend is $3.00, in 2009 $3.25, in 2010 $3.50, and in 2011 and all the subsequent years it will be $4.00. The shareholders of Texas require a return of 13% on their investment. Find the price of this stock on July 16, 2008, just after it has paid its dividend. What is its price on July 14, 2010, just before it pays its dividend? Please show all calculations.

Reference no: EM1330840

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