Question
NH Wildlife Co. expects to pay dividends of $2, $2.50, and $3.00 the next 3 years. After that, it expects its dividends to increase by
NH Wildlife Co. expects to pay dividends of $2, $2.50, and
$3.00 the next 3 years. After that, it expects its dividends to
increase by 5% every year. If its equity cost of capital is 12%,
what is the current price for a share of stock?
1) Value of first 3 dividends
2) Price at future period N
Important: What is N & what is N+1 in this case?
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Risk Sensitive Investment Management
Authors: Mark H A Davis, Sébastien Lleo
1st Edition
9814578037, 978-9814578035
