The parts a), b), c) and d) below are independent questions which do not relate to each other. a) Seed Ltd will pay its first dividend of $3.50 per share in 4 years' time. The annual dividend then remains unchanged forever. Calculate the share price today if the rate of return is 9% p.a. Round your answer to the nearest cent. " b) Firm JLD has just paid a dividend of $2.20 per share. If the constant dividend growth rate is 5% p.a. and the required rate of return is 10% p.a., calculate the current value of a JLD share. Round your answer to the nearest cent."
The parts a), b), c) and d) below are independent questions which do not relate to each other. a) Seed Ltd will pay its first dividend of $3.50 per share in 4 years' time. The annual dividend then remains unchanged forever. Calculate the share price today if the rate of return is 9% p.a. Round your answer to the nearest cent. " b) Firm JLD has just paid a dividend of $2.20 per share. If the constant dividend growth rate is 5% p.a. and the required rate of return is 10% p.a., calculate the current value of a JLD share. Round your answer to the nearest cent."
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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Transcribed Image Text:The parts a), b), c) and d) below are independent questions which do not relate to each other.
a) Seed Ltd will pay its first dividend of $3.50 per share in 4 years' time. The annual dividend then remains
unchanged forever. Calculate the share price today if the rate of return is 9% p.a. Round your answer to
the nearest cent. "
b) Firm JLD has just paid a dividend of $2.20 per share. If the constant dividend growth rate is 5% p.a. and
the required rate of return is 10% p.a., calculate the current value of a JLD share. Round your answer to
the nearest cent."
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