The jackson-timberlake wardrobe co. just paid a dividend of $1.85 per share on its stock. the dividends are expected to grow at a constant rate of 4 percent per year indefinitely. investors require a return of 12 percent on the company's stock. a. what is the current stock price? b. what will the stock price be in three years? c. what will the stock price be in 14 years?

The answers are:

A) $24.05

B) $27.05

C) $41.65

Explanation:

This type of stock can be considered a perpetuity, since it pays dividends at a fixed rate indefinitely. The formula for calculating the current value of a perpetuity is:

Perpetuity = [dividend x (1 + g)] / (r - g)

where:

A) current value: perpetuity = $1.85 x 1.04 / (12% − 4%) =$1,924 / 8%= $24.05

B) value in three years: perpetuity = $1.85 x (1.04⁴) / 8% = $27.05

C) value in fourteen years: perpetuity = $1.85 x (1.04¹⁵) / 8% = $41.65

answer is a

explanation:

the u.s. census bureau produces data on the population and economy nationwide. it can you to analyze the kind of people living in your neighborhood. it does not show you the market of people willing to buy your product or an existing market for your product. that will require more market research. the census bureau only gives you an insight to the demographics in your area.