Problem 7-28 nonconstant growth (lo2) planned obsolescence has a product that will be in vogue for 3 years, at which point the firm will close up shop and liquidate the assets. as a result, forecast dividends are div1 = $12.00, div 2 = $12.50, and div 3 = $28.00. what is the stock price if the discount rate is 10%? (do not round intermediate calculations. round your answer to 2 decimal places.) stock price

Po = D1        +     D2    +         D3

       (1 + Ke)     (1 + Ke)2   (1 + Ke)3                                                                                                                                          

Po = $12 +   $12.50 +      $28

     (1 + 0.1)    (1 + 0.1)2   (1 + 0.1)3

Po = $12 + $12.50 + $28

        1.1       (1.1)2        (1.1)3

Po = $10.91 + $10.33 + $21.04

Po = $42.28  

Explanation:                                                                      

The current stock price is a function of future dividends capitalised at the cost of capital of the company of 10% for a period of 3 years.  

two years ago, when picking flowers in the mountains back of yosemite valley, i found a book. it was blotted and storm-beaten; all of its outer pages were mealy and crumbly. the paper seemed to dissolve like the snow beneath which it had been buried, however; many of the inner pages were well preserved. and although all were more or less stained and torn, whole chapters were easily readable. this is the condition of the great open book of yosemite glaciers today; its granite pages have been torn and blurred by the same storms that wasted the castaway book.

two years ago, when picking flowers in the mountains back of yosemite valley; i found a book. it was blotted and storm-beaten, all of its outer pages were mealy and crumbly. the paper seemed to dissolve like the snow beneath which it had been buried, however, many of the inner pages were well preserved. and although all were more or less stained and torn; whole chapters were easily readable. this is the condition of the great open book of yosemite glaciers today, its granite pages have been torn and blurred by the same storms that wasted the castaway book.

answer: b. false

the staff is a set of five horizontal lines and four spaces which represent a different musical pitch. the lines and the spaces are numbered from bottom to top, the bottom line is the first line and the fifth line is the line on the top. the notes on the top of the staff (fifth line) have a higher pitch than a note at the bottom of the staff.