Required returns stopping Ltd recently suspended its dividend payment. management anticipates that a dividend of $0.16 per share will be restored in five years and that the dividend will be increased at at rate of 6 per cent per year thereafter. the shares currently sell for $1.20 per share.

 What is the required return in this case?

Answer rating: 100% (QA)

To calculate the required return we can use the dividend discount model DDM which is based on the pr... View the full answer