Estimate the share price of rossman

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Question 1: Rossman Company expects constant dividend growth of 3% in future years. Its last dividend was $1.50 per share. The required return on similar risk firms is 12% . Estimate the share price of Rossman.

Question 2: Bank One is offering a loan at a 9% nominal rate of interest, with quarterly compounding. Bank Two is offering an 8.7% nominal rate of interest with monthly compounding. What is the effective rate of interest for each of these loans? Which loan provides a better return?

Reference no: EM132477714

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