How much are you willing to pay for one share of red snapper

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Problem 1: How much are you willing to pay for one share of Red Snapper stock if the company just paid a $0.60 annual dividend, the dividends increase by 2.4 percent annually, and you require a 9 percent rate of return?

Po =Do x (1 + g)/(R-g) where D=Dividend paid, g =growth rate, R =Required return)

Dividend 0.6
Increase 2.40%
Required Return 9%
Constant Growth Model

Reference no: EM132771798

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