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Calculate the market capitalization of the company

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Reference no: EM132979623

Questions -

a: A company has the following financial information available:

-Share capital in issue: 4 million ordinary shares at a par value of $0.50

-Current dividend per share: $0.24

-Dividend four years ago: $0.1525

-Current equity beta: 0.8

-You also have the following market information:

-Current market return: 15%

-Risk-free rate: 8%

Required - Calculate the market capitalization of the company.

b: A company has the following financial information available:

-Share capital in issue: 2 million ordinary shares at a par value of $1

-Current dividend per share: $0.18

-Current EPS: $0.25

-Current return earned on equity: 20%

-Current equity beta: 1.1

You also have the following market information:

-Current market return: 12%

-Risk-free rate: 5%

Required - Calculate the market capitalization of the company.

Reference no: EM132979623

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