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Equity pricing ABC is expected to pay GHS 500 dividend per share next year, and then sell for GHS 2,000 thereafter. If your discount rate
Equity pricing
ABC is expected to pay GHS 500 dividend per share next year, and then sell for GHS 2,000 thereafter. If your discount rate is 28%, how much will you pay for a share today? Suppose dividends will increase by 10% per annum and you have a 4-year holding period in mind. That is, you will sell the share after you received the fourth dividend, having received each of the first three dividends. How much will you pay for the share today, if the price is also expected to increase at 10% p.a. over the four years? .
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