What is the current price of this share

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a. Moriarty Co Ltd has been growing at a rate of 3.5% for the past 4 years, and the company's CEO expects the company to continue to grow at this rate for the next several years. The company has just paid a dividend of $1.25. If your required rate of return was 10%, what is the maximum price that you would be willing to pay for this company's shares?

b. Sherlock Ltd is planning to pay a dividend of $1.50 next year. The expected share price a year from now is $24.20. The required rate of return is 12%. Assume a constant growth, what is the current price of this share?

Reference no: EM133071226

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