What should the fair value be four years from today

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A stock you are evaluating just paid an annual dividend of $3.00. Dividends have grown at a constant rate of 1.3 percent over the last 15 years and you expect this to continue.

a. If the required rate of return on the stock is 13.1 percent, what is its fair present value? (Do not round intermediate calculations. Round your answer to 2 decimal places. (e.g., 32.16))

Fair present value $

b. If the required rate of return on the stock is 16.1 percent, what should the fair value be four years from today? (Do not round intermediate calculations. Round your answer to 2 decimal places. (e.g., 32.16))

Expected fair value $

Reference no: EM131996415

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