Find the current share value

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Reference no: EM131979216

1. A small business refits its store. The builders charge them $121,000 which will be paid back in monthly installments over three years at 7.5%APR. The builders will reduce this rate to 7% APR if they pay $2420 up front. By approximately how much will this reduce the monthly loan repayments? ?

2. Stock A just paid dividend of $2 and the effected annual required rate is 15%. Find the current share value if dividends are expected to grow by $0.10 per year indefinitely. (in this case, it is a growing perpetuity but at a non-constant growth rate, what would be an appropriate approach?)

Reference no: EM131979216

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