Springboro Tech Is a Young Start-Up Company

Multiple Choice

Springboro Tech is a young start-up company.No dividends will be paid on the stock over the next 15 years,because the firm needs to plow back its earnings to fuel growth.The company will pay a $15 per share dividend in 16 years and will increase the dividend by 4 percent per year thereafter.What is the current share price if the required return on this stock is 8 percent?

A) $118.22
B) $119.19
C) $120.00
D) $164.59
E) $240.00