Answer to Question #112761 in Finance for Nuna

Question #112761
Tribeda corporation has just paid a dividend of RM1.20 per share.the dividend is expected to grow at 6% a year for the next 3 years, and then to grow at 8% a year thereafter.

If the required rate of return is 14%, compute the value of the share today.
1
Expert's answer
2020-04-30T09:59:18-0400

If the required rate of return is 14%, then the value of the share today is:

"P = \\frac{1.2\\times1.06^3\\times1.08}{0.14 - 0.08} = RM25.73."




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