Calculate the current value of lmn ordinary shares

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Problem : The dividends of ordinary shares of LMN Corporation have been experiencing an annual growth rate of 10%. The present dividend per share is $ 1.20. The investor is requiring a 15% rate of return. Required: Calculate the current value of LMN's 200 ordinary shares under each of the following independent conditions.

Question a) Dividends to continue growing at a constant rate of 10%.

Question b) Dividend growth rate is anticipated to decrease by 1.5% and to remain constant at that level.

Question c) Dividend growth rate is expected to increase to 12.5% and to remain constant at that level

Reference no: EM132469446

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