Problem:
Beaksley, Inc. is a very cyclical type of business which is reflected in its dividend policy. The firm pays a $2.00 a share dividend every other year. The last dividend was paid last year. Five years from now, the company is repurchasing all of the outstanding shares at a price of $50 a share.
Requirement:
Question: At an 8% rate of return, what is this stock worth today?
Note: Please show guided help with steps and answer.