Question 1

(a) Aida Inc pays an annual dividend of $2 per share, has a required return(Rs)=10%, and dividends are expected to grow at constant rate of 4%.What is the Intrinsic Stock Value per share for Aida Inc.?

(b) Aida Inc, pays last dividend was $2,0 per share.The dividend is expected to grow 20% for year 0 to year 1, 10% for year 1 to year 2 , and then at a constant 4%.Calculate the Estimated Intrinsic Common Stock Value fore Aida Inc based on the dividend projections, assuming (Rs) required return =10%.?