What is the current value of a share of drone inc

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Drone, Inc currently pays $3.50 dividend per share. Next years dividend is expected to be $4 per share. After next year, dividends are expected to increase at a 5 percent annual rate for three years and a 4 percent annual rate thereafter.

problem 1: What is the current value of a share of drone, inc stock to an investor who requires a 12 percent return on his or her investment. Calculate all values as if you are in DO, or year 0.

Option 1: $49.87
Option 2: $54.30
Option 3: $51.01
Option 4: $50.3031

Reference no: EM132795616

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