Your Local Toy Store Just Announced Its Annual Dividend Will

Multiple Choice

Your local toy store just announced its annual dividend will be $4 dividend next year, $3 the following year, and then a final liquidating dividend of $46 a share in Year 3. At a discount rate of 18 percent, what should one share sell for today?

A) $36.21
B) $31.48
C) $35.64
D) $39.09
E) $33.54