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An ordinary share just paid a dividend of $1 today. The annual dividend will grow at 30% p.a. for the first year and 20% p.a.
An ordinary share just paid a dividend of $1 today. The annual dividend will grow at 30% p.a. for the first year and 20% p.a. for year 2 and year 3. From the end of year 3, the growth rate will be constant at 4% p.a. forever. The rate of return is 12% p.a. Which of the following equation(s) can be used to find the price of the share today? (There may be more than one correct answer. You will lose marks by choosing a wrong answer. The minimum mark for the question is zero.) = Select one or more: 1.3 * 1.22 a. 1.3 1.3 * 1.2 Po 0.12 - 0.04 + + 1.12 1.122 1.122 b. None of the equation gives the correct answer. 1.3 * 1.22 * 1.04 1.3 1.3 * 1.2 1.3 * 1.22 P. 0.12 - 0.04 + + + 1.12 1.122 1.123 1.124 d. 1.3 * 1.22 * 1.04 0.12 0.04 1.123 1.3 1.3 * 1.2 1.3 * 1.22 + + + 1.12 1.122 1.123 e. 1.3 * 1.22 1.3 1.3 * 1.2 0.12 -0.04 + + 1.12 1.122 1.123 f. 1.22 * 1.04 1.3 1.2 1.22 0.12 0.04 + + + 1.12 1.122 1.123 1.123
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