Chapter $7$: Stock Valuation

Exercise $1$: valuing a share of a stock $($P$)$ that pays a dividend and you expect to hold it for one period assume you expect the dividend to be $$1$ in one year $($not right away, but wait one year out$)$ you expect to sell$/$receive $$18$ for one share of this stock in one year you have a required return of $10\%($for investments of similar risk$)$ how much should you pay for this one share? You don't want to pay too much...

$\backslash$table$[[$Answer: $P=,17\mathrm{.}27]]$

Exercise $2$: valuing a share of a stock $(P)$ that pays a constant dividend forever assume you expect the dividend to be $$0\mathrm{.}50$ in one year $($not right away, but wait one year out$)$

$\backslash$table$[[,$required rate of return is $7\%$