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Business, 14.04.2020 23:49 alasiaca

Your broker offers to sell you some shares of IBM stock that paid a dividend of $2 yesterday. You expect the dividend to grow at the rate of 5% per year for the next 3 years, and, if you buy the stock, you plan to hold it for 3 years and then sell it. Investors require a 12% return from this investment. a) If you plan to buy the stock, hold it for 3 years, and then sell it for $34.73, what is the most you should pay for it?

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