Question
You are examining a stock that currently pays a dividend of $2 per year, you expect the stock to grow by 15% for 5 years,
You are examining a stock that currently pays a dividend of $2 per year, you expect the stock to grow by 15% for 5 years, after that it will grow at 6% forever.
Which dividends would you need to find the time value of money for?
Hint: Do not include the one used in the constant growth formula.
| A. | D0, D1, D2, D3, D4, D5, D6 |
| B. | D1, D2, D3, D4, D5 |
| C. | D0, D1, D2, D3, D4, D5 |
| D. | D1, D2, D3, D4, D5, D6 |
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The Concepts And Practice Of Mathematical Finance
Authors: Mark S. Joshi
1st Edition
0521823552, 9780521823555
