Question 1: It is 31 January 2017 and the managers of DBX Berhad are considering a change in the company's dividend policy. Earnings per share for 2016 for the company were 22.8 sen per share and the Finance Director has said that he expects this to increase to 25 sen per share for 2017. The increase in earnings per share is in line with market expectations of the company's performance. The pattern of recent dividends, which are paid each year on 31 December, is as follows:
Year		2016	2015	2014	2013	2012	2011
Dividend per share (sen)		11.4	11.1	9.6	9.6	9.2	8.5
The Managing Director has proposed that 70% of earnings in 2017 and subsequent years should be retained for investment in new product development. It is expected that the after-tax return on this investment will be 12.5%. DBX Berhad's cost of equity capital is estimated to be 12%.
(i) Calculate the share price of DBX Berhad in the case, the Company decides not to change the current dividend, and in the case that the Company decides to change the dividend policy as proposed by the Managing Director and announces the change to the market.