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Dmitriy789 [7]
3 years ago
12

Nyeil is a consumer products firm that is growing at a constant rate of 6.5 percent. The firm’s last dividend was R3.36. If the

required rate of return is 18 percent, what is the market value of this stock if dividends grow at the same rate as the firm?
Business
1 answer:
OleMash [197]3 years ago
3 0

Answer:

31.12

Explanation:

Given that,

Growing at a constant rate = 6.5%

Firm’s last dividend, R = 3.36

Required rate of return = 18%

Expected dividend next year = 3.36 × (1 + 6.5%)

                                                 = 3.5784

Market value of stock:

= Expected dividend next year ÷ ( required return - growth rate)

= 3.5784 ÷ (0.18-0.065)

= 31.11652

= 31.12

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2 years ago
Great Southeast ​Company's Cash account shows an ending balance of $ 660. The bank statement shows a $ 27 service charge and an
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As we know that

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Shelly’s preferences for consumption and leisure can be expressed as U(C, L) = (C – 100) * (L – 40). This utility function impli
ludmilkaskok [199]

Answer:

Explanation:

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C = 420

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