Your broker offers to sell you some shares of Bahnsen & Co. common stock that paid a dividend of $1.50 yesterday. Bahnsen's dividend is expected to grow at 4% per year for the next 3 years. If you buy the stock.you plan to hold it for 3 years and then sell it. The appropriate discount rate is 11%a. Find the expected dividend for each of the next 3 years; that is, calculate D1, D, and Dy. Note that Do $1.50. Do not round Intermediate calculations. Round your answers to the nearest centDISDJ SDi sb. Given that the first dividend payment will occur 1 year from now, find the present value of the dividend stream, that is, calculate the PVS of D1, D2, and D, and tIntermediate calculations. Round your answer to the nearest cent$c. You expect the price of the stock 3 years from now to be $25.07; that is, you expect Ps to equal $25.07, Discounted at an 11% rate, what is the present value of this expected future stock price? In otherwords, calculate the PV of $25.07, Do not round intermediate calculations. Round your answer to the nearest cent1d. If you plan to buy the stock, hold it for 3 years, and then sell it for $25.07, what is the most you should pay for it today? De not round intermediate calculations. Round your answer to the nearest centS* Use equation below to calculate the present value of this stockPh.DENEAssume that g-4% and that it is constant. Do not round intermediate calculations. Round your answer to the nearest cent1these PVs. Do not roundf. Is the value of this stock dependent upon how long you plan to hold 2? In other words, if your planned holding period was 2 yearsPotrather than 3 years, would this affect the value of the stock today.Select1. No. The value of the stock is not dependent upon the holding period. The value calculated in parts a through d is the value for a 3-year holding period. It is equal to the value calculated in parteAny other holding period would produce the same value of P11. Yes. The value of the stock is dependent upon the holding period. The value calculated in parts a through d is the value for a 3-year holding period. It is not equal to the value calculated in parte.Any other holding period would produce a different value of P.III. ves. The value of the stock is dependent upon the holding period due to the fact that the value is determined as the present value of all future expected dividendsIV. No. The value of the stock is not dependent upon the holding period unless the growth rate remains constant for the foreseeable future.V. Yes. The value of the stock is dependent upon the holding period as long as the growth rate remains constant for the foreseeable future.

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Your broker offers to sell you some shares of Bahnsen & Co. common stock that paid a dividend of $1.50 yesterday. Bahnsen's dividend is expected to grow at 46 per year for the next 3 years. If you buy the stock you plan to hold it for 3 years and then sell it. The appropriate discount rate is 11% a. Find the expected dividend for each of the next 3 years; that is, calculate Ds, Dy, and Dy. Note that Do $1.50. Do not round intermediate calculations. Round your answers to the nearest cent DIS D) $ Di-F b. Given that the first dividend payment will occur 1 year from now, find the present value of the dividend stream; that is, calculate the PVs of Di, D, and Ds, and then sum these PVs. Do not round Intermediate calculations. Round your answer to the nearest cent $ c. You expect the price of the stock 3 years from now to be $25.07, that is, you expect Ps to equal $25.07, Discounted at an 11% rate, what is the present value of this expected future stock price? In other words, calculate the PV of $25.07. Do not round intermediate calculations. Round your answer to the nearest cent d. If you plan to buy the stock, hold it for 3 years, and then sell it for $25.07, what is the mest you should pay for it today? De not round intermediate calculations. Round your answer to the nearest cent 1 Use equation below to calculate the present value of this stock P 48 Assume that g-4% and that it is constant. Do not round intermediate calculations. Round your answer to the nearest cent 1 Is the value of this stock dependent upon how long you plan to hold a? In other words, if your planned holding period was 2 years or 5 years rather than 3 years, mould this affect the v P.7 1. No. The value of the stock is not dependent upon the holding period. The value calculated in parts a through dist value for a 3-year holding period. It is equal to the value calculated in parte Any other holding period would produce the same value of P ar holding period. It is not equal to the value calculated in parte 11. Yes. The value of the stock is dependent upon the holding period. The value calculated in parts a through d is the value f Any other holding period would produce a different value of Pe of the stock today. III. Ves. The value of the stock is dependent upon the holding period due to the fact that the value is determined as the present value of all future expected dividends IV. No. The value of the stock is not dependent upon the holding period unless the growth rate remains constant for the foreseeable future. v Yes. The value of the stock is dependent upon the holding period as long as the growth rate remains constant for the foreseeable future.