In Chapter 10 we learned that the dividend growth model suggests that the fair value of a common share is based on next year 's dividend This is expressed in the formula P0 D1 K0 g With this in mind, how is it possible for a company like Google, which has never paid a dividend, to have a share pric...

The dividend growth model has validity because at some point inves ...

In Chapter 10 we learned that the dividend growth model suggests that the fair value of a

Question:

In Chapter 10 we learned that the growth model suggests that the fair value of a common share is based on next year's This is expressed in the formula P0 = D1 / K0 - g. With this in mind, how is it possible for a company like Google, which has never paid a to have a share price of around US $500?
Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...