c) Capital Bhd. just paid a dividend of RM2.00 per share on its stock. The dividends are expected to grow at a constant 6 percent per year indefinitely. If investors require a 13 percent return on Capital stock, calculate; i) The current stock price ii) The stock price in 3 years (CE) iii) The stock price in 15 years

EBK CONTEMPORARY FINANCIAL MANAGEMENT
14th Edition
ISBN:9781337514835
Author:MOYER
Publisher:MOYER
Chapter7: Common Stock: Characteristics, Valuation, And Issuance
Section: Chapter Questions
Problem 12P
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c) Capital Bhd. just paid a dividend of RM2.00 per share on its stock. The dividends are
expected to grow at a constant 6 percent per year indefinitely. If investors require a
13 percent return on Capital stock, calculate;
i) The current stock price
ii) The stock price in 3 years
(CE)
iii) The stock price in 15 years
Transcribed Image Text:c) Capital Bhd. just paid a dividend of RM2.00 per share on its stock. The dividends are expected to grow at a constant 6 percent per year indefinitely. If investors require a 13 percent return on Capital stock, calculate; i) The current stock price ii) The stock price in 3 years (CE) iii) The stock price in 15 years
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