Please do not refer me to other sites. I need someone to show me how this is done so I can understand it.
Sable Corp. has been paying an annual dividend of $3 per share for 10 years and is expected to continue such payments in the future.
A.) If the firm's shares are selling for $20 per share, what is the cost of common stock?
B.) If instead of the no growth situation, the firm were growing at an annual rate of 5% and increasing its dividends at the same rate, what would be the price of the firm's stock? (assume stockholders' desire a 15% rate of return)
ancestors of g?rald joyce
