Question

Asked Oct 8, 2019

Gillette's most recent annual dividend was $8 per share. The company expects the growth of its dividends to be stable at 3% per year going forward.

a) If investors require a 9% return, what is the current value of Gillette's stock? (round to nearest cent)

b) If the stock currently trades at $116.57 per share, what is the dividend growth rate investors expect? (round to nearest percent)

Answer in Excel.

Step 1

Part A& B:

**Calculation of Current Value of Stock and Dividend Growth Rate:**

**Excel Spreadsheet:**

Step 2

**Excel Workings**

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