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9a - 9b please and thank you so much 9a) Starting from the next year, company ABC is going to pay a dividend of $3
9a - 9b please and thank you so much
9a) Starting from the next year, company ABC is going to pay a dividend of $3 per share every quarterfor 5 years. After that, the dividend will keep increasing at a rate of 0.5% per quarter forever. Whats the value of the companys stock if the appropriate (quoted) annual discount rate is 12%?
9b ) A firm just paid a dividend of $2. The dividend will grow by 30% in the next year, 40% in the year after, and 20% the year after. After that, it will grow at a constant rate of 4% every year and will continue to do so forever. If its cost of (equity) capital is 12% per year, what should the share price be?
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