question archive The following information is provided to you: a) current market price of the share = $24 b) Recent Dividend per share = $1 c) Risk-free rate = 4 percent; d) Estimated beta = 1
Subject:FinancePrice: Bought3
The following information is provided to you: a) current market price of the share = $24 b) Recent Dividend per share = $1 c) Risk-free rate = 4 percent; d) Estimated beta = 1.2 e) Equity risk premium = 5 percent. Determine the constant dividend growth rate that would be required to justify the market price of $24.