Answer:
$6.87
Explanation:
The Dividend will grow first with non-constant growth rate and then after 3 years it will grow at a constant rate of 2%.
Last Dividend Paid = $6.18
In the first year the Growth rate is 3%
First Year Dividend = $6.18 ( 1 + 3% ) = $6.18 ( 1 + 0.03 ) = $6.18 ( 1.03 ) = $6.3654
In the Second year the Growth rate is 8%
Second Year Dividend = $6.3654 x ( 1 + 8% ) = $6.3654 x ( 1 + 0.08 ) = $6.3654 x ( 1.08 ) = $6.87
Answer: $40
Explanation:
First find the required return using CAPM;
Required return = Riskfree rate + beta * (Market return - riskfree rate)
= 6% + 0.5 * (13% - 6%)
= 9.5%
Then use DDM to determine intrinsic value;
= Next dividend / (Required return - growth rate)
= 5 / (9.5% - (-3%))
= $40
Answer:
According to the law of demand, there is a negative or an inverse relationship between the price of the good and the quantity demanded of that good. This means that an increase in the price of a commodity will lead to decrease the quantity demanded for this commodity and a fall in the price of a commodity will lead to an increase in the quantity demanded for this commodity.
The answer is feedback. This is considered to be an information
in which is about the product or services being performed. They are also
referred to as reactions produced by other people in means of having to use it
as a basis for improvement or to correct some minor issues.
