29. Nonconstant Growth. Tattletale News Corp. has been growing at a rate of 20% per year, and you expect this growth rate in earnings and dividends to continue for another three years. (L07-2) a. If the last dividend paid was $2, what will the next dividend be? b. If the discount rate is 15% and the steady growth rate after three years is 4%, what should the stock price be today?

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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29. Nonconstant Growth. Tattletale News Corp. has been growing at a rate of 20% per year, and you expect this growth rate in earnings and
dividends to continue for another three years. (L07-2)
a. If the last dividend paid was $2, what will the next dividend be?
b. If the discount rate is 15% and the steady growth rate after three years is 4%, what should the stock price be today?
n
Pap 229
Transcribed Image Text:29. Nonconstant Growth. Tattletale News Corp. has been growing at a rate of 20% per year, and you expect this growth rate in earnings and dividends to continue for another three years. (L07-2) a. If the last dividend paid was $2, what will the next dividend be? b. If the discount rate is 15% and the steady growth rate after three years is 4%, what should the stock price be today? n Pap 229
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