Regarding of your work above suppose that d0 which was just, Ask an Expert

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Regardless of your work above, assume that D0, which was just paid, = $1.00, D1= $1.20, D2 = = $1.40, D3 = $1.55, D4 = $2.00, D5 = $2.13, D6 = $2.27, and P3 = $80.00. What should be the stock's expected price today, (i.e.. P0)? I encourage you to draw a time line clearly indicating the situation. Again, assume the required return is 8.6 percent.
a. 87.15
b 65.96
c. 66.96
d. 79.14
e. 68.4

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