Far Side Corporation is expected to pay the following dividends over the next four years: $12, $10, $6, and $2. Afterward, the company pledges to maintain a constant 6 percent growth rate in dividends forever. Required: If the required return on the stock is 14 percent, what is the current share price?
The spot price of an investment asset that providesn income of $2 at the end of the first year and at the end of the second year is $36. The risk-free rate for all maturities (with continuous compounding) is 12%. What, to the nerest cent, is the three-year forward price?