Topic: Cost of Funds Solve the following cases using the Gordon Growth Model of determining the cost of funds. (No Time Period given) 1. Current dividend on ordinary share P8 Return on Equity 15% Payout Rate 30% Expected Dividend ?

Topic: Cost of Funds Solve the following cases using the Gordon Growth Model of determining the cost of funds. (No Time Period given) 1. Current dividend on ordinary share P8 Return on Equity 15% Payout Rate 30% Expected Dividend ?

PFIN (with PFIN Online, 1 term (6 months) Printed Access Card) (New, Engaging Titles from 4LTR Press)

6th Edition

ISBN:9781337117005

Author:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Publisher:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Chapter13: Investing In Mutual Funds, Etfs, And Real Estate

Section: Chapter Questions

Problem 8FPE

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Question

Topic: Cost of Funds

Solve the following cases using the Gordon Growth Model of determining the cost of funds. (No Time Period given)

1. Current dividend on ordinary share P8

Return on Equity 15%

Payout Rate 30%

Expected Dividend ?

2. Current dividend on ordinary share P8

Growth Rate 10%

Market price per ordinary share P55

Flotation Costs 6%

Cost of ordinary share ?

Cost of retained earnings ?

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