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Yo are going to receive dividends from company ABC in years 1 and 2. After that the company will disappear. The dividends will be $100
Yo are going to receive dividends from company ABC in years 1 and 2. After that the company will disappear. The dividends will be $100 in every period. What is the price of the companys stock if you use the information from the previous question? Suppose now that the company will pay $100 in dividends but for 10 years. What is the new price? What is the price of the company if this pays $100 per period, forever? Assume in all cases a 10% discount rate.
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