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Question - Suppose that today's stock price is $31.05. If the required rate on equity is 16.3% and the growth rate is 3.1%, compute the expected dividend (i.e. compute D1)

ABC Inc.'s stock is currently selling for $88.33 per share. The company just paid its first annual dividend of $0.87 a share. The firm plans to increase the dividend by 5.4 percent per year indefinitely. What is the required rate of return on equity?

ABC's last dividend paid was $4.15, its required return is 20%, its growth rate is 6%. What is ABC's expected stock price in 19 years?

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