Dividend at time 5 will be= $4.501.
dividend at time 5 = d0 *(1+growth rate)^5
= $3.00 *(1+0.06)^5
= $4.501.
Growth rates are the changes in a particular variable's percentage over a given period of time. Increase rates, for investors, often represent the compounded yearly rate of growth of a company's revenues, earnings, dividends, or even macro terms, such as gross domestic product (GDP) and retail sales.
Use the basic growth rate formula to determine the percentage growth rate by deducting the original value from the new value and dividing the results by the original value. Multiplying the results by 100 time will convert that to an increase in percentage.
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