What is long term rate of dividend growth expected by market

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Reference no: EM131329170

Investors expect the following series of dividends from a particular common stock:

Year One	$1.10
2^nd Year	$1.25
3^rd Year	$1.45
4^th Year	$1.60
5^th Year	$1.75

After the fifth year, dividends will grow at a constant rate.

If the required rate of return on this stock is 9 percent and the current market price is $45.64, what is the long-term rate of dividend growth expected by the market?

Reference no: EM131329170

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