Problem:
Alexander Corp. will pay a dividend of $4.10 next year. The company has stated that it will maintain a constant growth rate of 5.25 percent a year forever.
Requirement:
Question 1: If you want a return of 18 percent, how much will you pay for the stock?
Question 2: If you want a return of 10 percent, how much will you pay for the stock?
Note: Please show guided help with steps and answer.