The most recent dividend the company paid is $2 per share. Experts expect the dividends to grow at 1% a year indefinitely. If the appropriate discount rate is 5%, what is the fair share price?

 

What is the present value of $1000 that your grandparents promised to give you as a birthday present in 2 years if the appropriate discount rate is 2% a year?

 

You are thinking about investing $10 000 in a start-up and selling 1/2 of your stake at the next round of funding in 5 years and the other half - at the IPO, which is expected in 10 years. The company is expected to grow at 13% a year until its IPO date. What is the value of this investment opportunity to you today, if the risk-adjusted discount rate is 10%?

 

Answer rating: 100% (QA)

1 Fair Share Price Calculation Given Recent dividend 2 per share Dividend growth rate 1 Discount rat... View the full answer