Expected to pay annual dividends

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Martin's Inc. is expected to pay annual dividends of $2.50 a share for the next three years. After that, dividends are expected to increase by 3% annually. What is the current value of this stock to you if you require a 9% rate of return on this investment?

A) $42.92

B) $41.81

C) $40.11

D) $39.47

Please show how you got the answer.

Reference no: EM13952271

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