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Company HDE is expected to pay an interim dividend of $1.00 three months from now and...

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Finance

Company HDE is expected to pay an interim dividend of $1.00three months from now and a final dividend of $2.10 one year fromnow. HDE is then expected to repeat the same pattern every year forthe foreseeable future with no growth in dividends. Given that theappropriate effective discount rate is 7.0% p.a., what is the stockprice of HDE closest to today? A) $43 B) $44 C) $45 D) $46 E) Noneof the above

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