The Bell Weather Co

Multiple Choice

The Bell Weather Co. is a new firm in a rapidly growing industry. The company is planning on increasing its annual dividend by 15% a year for the next four years and then decreasing the growth rate to 5% per year. The company just paid its annual dividend in the amount of $1.00 per share. What is the current value of one share if the required rate of return is 10%?

A) $27.62
B) $28.79
C) $29.23
D) $32.15
E) $33.67