Nancy’s Antiques, Inc. just added a whole new line of furniture to her product line. Nancy expects this addition to result in record high dividends of $4.00 and $4.50 in the next two years. After that, she thinks her growth will level off at its usual 4.5% rate. The rate expected in the marketplace for investments similar to Nancy’s is 6%.
What is the current value of a share of Nancy’s? ______________
What will the value of a share be in year two (P2)? ______________
What will the value of a share be in year twelve (P12)? ______________