Keidis Industries will pay a dividend of $4.95, $6.05, and $7.25 per share for each of the next three years, respectively. In four years, you believe that the company will be acquired for $67.00 per share. The return on similar stocks is 10.8 percent. What is the current stock price?

Current stock price = $59.18

Explanation:

Current stock price = Present value of first three value+ Present value of terminal value

Current stock price = Dividend 1/(1+r)^1 + Dividend 2/(1+r)^2 + Dividend 3/(1+r)^3 + Terminal Value/(1+r)^4

Current stock price = $4.95/(1.108)+$6.05/(1.108)^2+$7.25/(1.108)^3 + $67/(1.108)^4

Current stock price = $4.46751 + $4.928059 + $5.329896 + $44.45450

Current stock price = $59.179965

Current stock price = $59.18

a manufacturer of printed circuit boards uses exponential smoothing with trend to forecast monthly demand of its product. at the end of december, the company wishes to forecast sales for january. the estimate of trend through november has been 200 additional boards sold per month. average sales have been around 1000 units per month. the demand for december was 1100 units. the company uses α = 0.20 and β = 0.10. make a forecast including trend for the month of january.