What is the price of the stock today given a required return

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Question 1: XYZ Inc. paid its annual dividend of $10 per share today and the dividends are expected to grow at 25 percent annually for the next 3 years. Due to the nature of its business, the demand for its product and net income will start to decline after 3 years. The firm plans to start reducing dividends by 8% indefinitely after three years keeping in view the declining net income of the firm. What is the price of this stock today given a required return of 16.5 percent?

Reference no: EM132869345

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