3. ATP Industries paid a $0,50 dividend to its common shareholders 6 years ago. It just...

Question

Question

Answer 1

Answer #1

Let the growth rate be x

0.50(1+x)^6 = 0.67

x = 5%

Value of stock = Expected Dividend/(Required return - growth rate)

10.05 = 0.67(1+5%)/(Required return - 5%)

Required return = 12%

Answer 2

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