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Should purchase emerald ordinary shares

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The ordinary shares of Emerald Ltd paid a dividend of $1.55 last year. Dividends are expected to have a growth rate of 6%p.a. If Emerald share current market price is $24.50 and your required rate of return is 10.5%p.a.,

Problem (a) Calculate the value of the share to you.

Problem (b) Should you purchase Emerald ordinary shares? (Give a reason for your answer.)

Reference no: EM132964514

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