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QUESTION 1 A. Dasuki is an investment manager who constantly advises his clients on their securities portfolio. He is currently evaluating an investment in the

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QUESTION 1 A. Dasuki is an investment manager who constantly advises his clients on their securities portfolio. He is currently evaluating an investment in the stock of Westle Bhd. The company currently pays dividend of RM1.50 per share and expect the dividend to grow rapidly for the next two years at 6% per year. In year three and year four, the dividend is expected to be RM1.80 and RM1.85 per year, respectively. Dividend payment per share would be constant thereon. Required: i) Determine the maximum price the clients would be willing to pay for the stock of Westle Bhd if they require 8% return on investment. (4 marks) ii) Advise whether Dasuki should recommend the client to buy the Westle Bhd's share if the current market price is RM25. (2 marks) iii) Explain any two (2) factors that affect the buying or selling decision for the stock

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