BL Plc, a manufacturing firm, is growing at a phenomenal rate of 15% due introduction of a snack for kids. Analysts believe this growth will last for five years. After that it is predicted the firm will grow by 8% per annum indefinitely. Last year BL Plc paid a dividend of GH¢10, shareholders require 20% return on their investment in similar firms. Determine the value of BL Plc.
BL Plc, a manufacturing firm, is growing at a phenomenal rate of 15% due introduction of a snack for kids. Analysts believe this growth will last for five years. After that it is predicted the firm will grow by 8% per annum indefinitely. Last year BL Plc paid a dividend of GH¢10, shareholders require 20% return on their investment in similar firms. Determine the value of BL Plc.
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
Section: Chapter Questions
Problem 1PS
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BL Plc, a manufacturing firm, is growing at a phenomenal rate of 15% due introduction of a snack for kids. Analysts believe this growth will last for five years. After that it is predicted the firm will grow by 8% per annum indefinitely. Last year BL Plc paid a dividend of GH¢10, shareholders require 20%
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