TelTec Inc has a patent that will expire in two years The firm is expected to grow at 10 percent for the next two years and dividends will be paid at year end It just paid a dividend of $1 00 After two years, the growth rate will decline to 4 percent immediately, and the firm will grow at this rate forever If the required rate of return is 11 percent, value the firms current share price

Question: TelTec Inc. has a patent that will expire in two years. The firm is expected to grow at 10 percent for the next two years

TelTec Inc. has a patent that will expire in two years. The firm is expected to grow at 10 percent for the next two years and dividends will be paid at year end. It just paid a of $1.00. After two years, the growth rate will decline to 4 percent immediately, and the firm will grow at this rate forever. If the required rate of return is 11 percent, value the firm’s current share price.

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