An investor is looking for a three year investment. Dimo PLC pays a dividend of Rs. 6.00 per share at the end of first year Rs. 9.00 and Rs. 15.00 respectively at the end of 2rd and 3rd years. After the 3rs year annual dividend growth rate is 5% forever. If the required return on this investment is 12%, what is the value of this share today?

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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An investor is looking for a three year investment. Dimo PLC pays a dividend of Rs. 6.00
per share at the end of first year Rs. 9.00 and Rs. 15.00 respectively at the end of 2rd and
3rd years. After the 3rs year annual dividend growth rate is 5% forever. If the required
return on this investment is 12%, what is the value of this share today?
Transcribed Image Text:An investor is looking for a three year investment. Dimo PLC pays a dividend of Rs. 6.00 per share at the end of first year Rs. 9.00 and Rs. 15.00 respectively at the end of 2rd and 3rd years. After the 3rs year annual dividend growth rate is 5% forever. If the required return on this investment is 12%, what is the value of this share today?
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