Grandiose growth has a dividend growth rate of 20%. the discount rate is 15%. the end-of-year dividend will be $3 per share. what is the present value of the dividend to be paid in year 1? year 2? year 3?

The present value of dividend to be paid at the end of year 1, year 2, and year 3 are $2.60, $2.95, and $2.84 respectively.

Explanation:

The end of the year dividend is $3 per share.

The dividend growth rate is 20%.

The discount rate is 15%.

PV of dividend to be paid at the end of year 1

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=$2.60

PV of dividend to be paid at the end of year 2

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=$2.72

PV of dividend to be paid at the end of year 3

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=$2.84