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CENGAGE MINDTAP Q Search this cou Stocks and Their Valuation Back to Assim Attempts: Average: 4. Problem 9.01 Click here to r

can someone please help me with DPS calculation? i am using a BA 2 Plus business analyst calculator. Thank you!
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Answer #1

Last Dividend, D0 = $3.75

Growth rate for next 3 years is 8% and a constant growth rate of 5% thereafter

D1 = $3.75 * 1.08 = $4.05
D2 = $4.05 * 1.08 = $4.37
D3 = $4.37 * 1.08 = $4.72
D4 = $4.72 * 1.08 = $5.10
D5 = $5.10 * 1.08 = $5.51

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