Welcome to Westonci.ca, where you can find answers to all your questions from a community of experienced professionals. Ask your questions and receive detailed answers from professionals with extensive experience in various fields. Our platform provides a seamless experience for finding reliable answers from a network of experienced professionals.
Sagot :
If the required return on Computech is 18% the value of the stock in today's calculation is $11.77
What is the growth rate of a stock?
This is the percentage change of the stock based on the annualized growth rate over a period of time.
D3 = $0.75
D4 = 0.75 x 1.49 = $1.1175
D5 = 1.1175 x 1.49 = $1.665075
D6 = $1.665075 x 1.10 = $1.8315825
At a growth rate of 10 percent
[tex]\frac{D6}{R-G}[/tex]
1.8315825/0.18-0.10
= $[tex]\frac{0.75}{1.18^3} +\frac{1.1175}{1.18^4} +\frac{1.665075}{1.18^5} +\frac{22.89478125}{1.18^5} \\[/tex]
= 0.456473 + 0.576394 + 0.7278196 + 10.0075198
= $11.77
The value of this stock today is $11.77
Read more on stocks here: https://brainly.com/question/25818989
Thank you for your visit. We are dedicated to helping you find the information you need, whenever you need it. We hope our answers were useful. Return anytime for more information and answers to any other questions you have. Westonci.ca is committed to providing accurate answers. Come back soon for more trustworthy information.