2. Company B paid dividend in 2021 of 0.9 USD, in line with the expected dividend growth of 5% each year.
Company C has announced it expects to pay a 1.8 dividend to common shareholders in 2022, and its cost of equity (CAPM) is of 8.9%. (Companys C paid dividend in 2020 of 1.5).
Both companies are from the tech sector where the expected rate of return of the market is of 9%.
a. Which company has the most expensive share price ?
b. Wich if the company would you rather buy if you had 25 to spend ?