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Calculating the future value of given a stock

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A company has announced the growth rate of its dividend going forward will be 2% annually forever. The dividend in year 4 will be $3.00. The discount rate on the stock is 10%. What will the stock price be in year 18?

51.48
50.47
55.43
22.45
65.97
66.99

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Solution Summary

Solution estimates the future value of given stock.

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  • BEng (Hons) , Birla Institute of Technology and Science, India
  • MSc (Hons) , Birla Institute of Technology and Science, India
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