Fresno Corp. is a fast-growing company that expects to grow at a rate of 27 percent over the next two years and then to slow to a growth rate of 13 percent for the following three years. If the last dividend paid by the company was $2.15. What is the dividend for 1st year? (Round answer to 3 decimal places, e.g. 15.250.) D1 $ What is the dividend for 2nd year? (Round answer to 3 decimal places, e.g. 15.250.) D2 $ What is the dividend for 3rd year? (Round answer to 3 decimal places, e.g. 15.250.) D3 $ What is the dividend for 4th year? (Round answer to 3 decimal places, e.g. 15.250.) D4 $ What is the dividend for 5th year? (Round answer to 3 decimal places, e.g. 15.250.) D5 $ Compute the present value of these dividends if the required rate of return is 14 percent. (Round intermediate calculations and final answer to 2 decimal places, e.g. 15.25.) Present value $

EBK CFIN
6th Edition
ISBN:9781337671743
Author:BESLEY
Publisher:BESLEY
Chapter11: The Cost Of Capital
Section: Chapter Questions
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Problem 9.5

Fresno Corp. is a fast-growing company that expects to grow at a rate of 27 percent over the next two years and then to slow to a growth rate of 13 percent for the following three years. If the last dividend paid by the company was $2.15.

 

 

 

What is the dividend for 1st year? (Round answer to 3 decimal places, e.g. 15.250.)

D1

 

$

 
 

 

 

 

 

What is the dividend for 2nd year? (Round answer to 3 decimal places, e.g. 15.250.)

D2

 

$

 
 

 

 

 

 

What is the dividend for 3rd year? (Round answer to 3 decimal places, e.g. 15.250.)

D3

 

$

 
 

 

 

What is the dividend for 4th year? (Round answer to 3 decimal places, e.g. 15.250.)

D4   $
 
 

 

 
 
 
 

What is the dividend for 5th year? (Round answer to 3 decimal places, e.g. 15.250.)

D5   $
 
 

Compute the present value of these dividends if the required rate of return is 14 percent. (Round intermediate calculations and final answer to 2 decimal places, e.g. 15.25.)

Present value

 

$

 

 

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