Tattletale News Corp. has been growing at a rate of 20% per year, and you expect this growthrate in earnings and dividends to continue for another 3 years.
a. If the last dividend paid was $2, what will the next dividend be?
b. If the discount rate is 15% and the steady growth rate after 3 years is 4%, what should the stock price be today?
Growth rate. .......20.00%
Last dividend paid... $2.00
Discount rate..........15.00%
Steady growth rate (b).4.00%