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Using gordon growth model Value of stock=Dividend paid*(1+growth)/required return-
growth rate Value of stock=5*1.05/(.15-.05) Value of stock= $52.5
Solution
Using gordon growth model Value of stock=Dividend paid*(1+growth)/required return-
growth rate Value of stock=5*1.05/(.15-.05) Value of stock= $52.5

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  • 1. Using gordon growth model Value of stock=Dividend paid*(1+growth)/required return- growth rate Value of stock=5*1.05/(.15-.05) Value of stock= $52.5 Solution Using gordon growth model Value of stock=Dividend paid*(1+growth)/required return- growth rate Value of stock=5*1.05/(.15-.05) Value of stock= $52.5