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What is the maximum price

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Reference no: EM133116223

Management has recently announced that expected dividends for the next three years will be as follows:

Year 1 2 3 Dividend $2.50 3.25 4.00

For the subsequent years, management expects the dividend to grow at 5 percent annually. If the risk-free rate is 4.3 percent, the return on the market is 10.3 percent, and the firm's beta is 1.4, what is the maximum price that you should pay for this stock?

Reference no: EM133116223

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