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1c). Estimate the current market price of Afterpay equity. Suppose that Afterpay expects to pay dividends of $5.75, $6.00, $7.50, and $8.00 per share for
1c). Estimate the current market price of Afterpay equity. Suppose that Afterpay expects to pay dividends of $5.75, $6.00, $7.50, and $8.00 per share for the next four years. Thereafter, the company expects its growth rate to be at a constant rate of 6%. If this information is communicated to the market, and the market's required rate of return is 12%. (5 marks)
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