Question
1.Delta Ltd has just paid a dividend of $6 per share. If the dividends are expected to grow at a constant rate of 8% per
1.Delta Ltd has just paid a dividend of $6 per share. If the dividends are
expected to grow at a constant rate of 8% per year indefinitely, what will
be the share price (to the nearest dollar) in 2 years- time, if investors
require a return of 12%?
A) $135
B) $189
C) $146
D) $126
2.A share currently sells for $28 a share. Its dividend is growing at a constant
rate, and its dividend yield is 5 percent. The required rate of return on the
companys share is expected to remain constant at 13 percent. What is the
expected share price seven years from now?
A) $47.99
B) $24
C) $29.40
D) $30
plz show the process, I will thum you up
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