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Excel Hile Edit View Insert Format Tools Data Window $ Help Spreadshe O O O 2.2.7. G 100% Home Layout Tables Charts SmartArt
Problem 18-15 Calculate the intrinsic value of GE in each of the following scenarios by using the three-stage growth model of
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Answer #1

a]

Intrinsic value = $224.02

в H Term value А 1 Inputs 2 Beta 3 mkt_prem 4 rf 5 k_equity 6 term_gwth 1.10 0.08 0.025 0.1130 0.1080 Dividend 1.04 1.23 1.41

=E2 А в 1 Inputs 2 Beta 1.1 3 mkt_prem 0.08 4 rf 0.025 5 k_equity 0.113 6 term_gwth 0.108 DE year Dividend Term value Investo

b]

k_equity = rf + (beta * market_prem)

Intrinsic value = $36.94

в c F Term value А 1 Inputs 2 Beta 3 mkt_prem 4 rf 5 k_equity 6 term_gwth 1.08 0.08 0.025 0.1114 0.06000 D year Dividend 2017

F =E2 А в 1 Inputs 2 Beta 1.08 3 mkt_prem 0.08 4 rf 0.025 5 k_equity =B4+(B2*B3) 6 term_gwth 0.06 DE year Dividend Term value

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