QUESTION FOUR Kazenene Ltd issued common stock to finance its business and since that time the company has experienced r
-
- Site Admin
- Posts: 899603
- Joined: Mon Aug 02, 2021 8:13 am
QUESTION FOUR Kazenene Ltd issued common stock to finance its business and since that time the company has experienced r
QUESTION FOUR Kazenene Ltd issued common stock to finance its business and since that time the company has experienced rapid growth The company expected that earnings and dividends would grow at a rate of 18 percent during the next 4 years and fall to a constant rate of 6 percent thereafter. The dividend payment for year one is K1 357 and shareholders required a rate of return on the stock is 12 percent A. Calculate the value of the stock today (15 MARKS) B Calculate the value of the stock at the end of year 5. (5 MARKS) [TOTAL: 20 MARKS]