LLOP Corporation just paid a $4 dividend per share, you expect the dividend to grow at 8% for the next 2 years and expect to
LLOP Corporation just paid a $4 dividend per share, you expect the dividend to grow at 8% for the next 2 years and expect to sell the stock at $50 at the end of year 2. What is the maximum price you would pay to buy the stock? The required rate of return is 15%.
The risk-free rate is 4%; the market risk premium is 8%. VVH Company's stock has a beta of 3. The lastdividend was $4 per share. The dividend is expected to grow at 5%. What is the expected price of the stock?
(Use excel formulas)
Step by Step Solution
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Step: 1
To solve the first question we can use the following Excel formula PV152450 This formula calcu...
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Step: 2
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Authors: Jonathan Berk, Peter DeMarzo, Jarrad Harford
5th Edition
0135811600, 978-0135811603
