The last annual dividend on kcbt corporations common stock


The last annual dividend on KCBT Corporation's common stock, paid yesterday, was $0.50. If you require a rate of return of 10 percent, KCBT has just announced a new product that they expect to cause the company to experience supernormal growth for two years of 15 percent, and then return to grow at constant 9 percent rate. Assuming that you still require a rate of return of 10 percent, what is the highest price you should be willing to pay for this stock?

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Financial Management: The last annual dividend on kcbt corporations common stock
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