1.Redland Corporations shares currently sells for $23.00 per share. The management anticipate a constant growth rate of 10.5 percent and the last dividend (D0) was $2.26.

If you require a 17% return on such investments, should you purchase the share?

2. The share price of Startel is currently $2.72 and the last dividend was $0.16. The analyst is predicting an annual dividend growth rate of 8% and the required rate of return is 15%. According to Gordon Growth model, is Startel share fairly priced and would you buy the share?