The Starr Co. just paid a dividend of $2.15 per share on its stock. The dividends are expected to grow at a constant rate of 5% per year, indefinitely. If investors require a return of 11% on the stock, what is the current price? What will the price be in three years? In 15 years?
complete, detailed and clear written calculations (including all formulas used) for all three questions.
Given: Pt = Divt / (R – g)