Determine the growth rate of stock

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Question 1: Shopee is expected to pay a P3 dividend per share at the end of the year. Currently, the stock sells for P45 per share and its required rate of return is 15%. The dividend is expected to grow at a constant rate. Determine the growth rate of the stock.

Question 2: Laz Co. paid a dividend of P2.00 last year. Its stock's required rate of return on equity is 10%. The growth rate is expected to be 4% for 1 year, 5% the next year, then 6% for the following year, and then the growth rate is expected to be a constant at 7% thereafter. What is the current share price of Laz Co.?

Reference no: EM132831241

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