Hi, thanks for the notes !!!! A question! In example 6 of chapter 7 (p4) shouldn’t we use the rearranged formula for the Growth model using instead of D0, D0*(1+g)^2 to calculate the price of the share in 2 yrs time? The way it is shown in the lecture I think it assumes that no dividends will be given out. Am I right?
No – you are wrong. If the dividends are growing at the rate of g per annum, then (in theory) the market value will also grow at the rate of g per annum. It is not assuming that there will be no dividends at all.
By all means use the growth model formula – as you say, Do becomes Do^2. You will arrive at exactly the same conclusion.
I dont understand the formula for working the average rate of growth out…..I am confused when he says the “4th root of 33,000/28,000 is 1.0419 as this is not the answer i get……….can some one please clarify please? thanks
Hi thanks so much for this wonderful resource!am using open tuition for the first time and have just downloaded course notes for P4. Can I view the lectures on my blackberry bold 9700? Thanks again.
Can you make the videos downloadable because we can not view it at proper speed / quality due to poor internet connection / speed and then many of the users in our part of the world may not have internet access from Home
faizahabib44 says
wheres this example taken from?
which book is he following?
admin says
Opentuition course notes
college00 says
i got confused what is the difference btween Re and Ke??????
obiwan1983 says
Hi, thanks for the notes !!!!
A question!
In example 6 of chapter 7 (p4) shouldn’t we use the rearranged formula for the Growth model using instead of D0, D0*(1+g)^2 to calculate the price of the share in 2 yrs time? The way it is shown in the lecture I think it assumes that no dividends will be given out. Am I right?
John Moffat says
No – you are wrong.
If the dividends are growing at the rate of g per annum, then (in theory) the market value will also grow at the rate of g per annum. It is not assuming that there will be no dividends at all.
By all means use the growth model formula – as you say, Do becomes Do^2. You will arrive at exactly the same conclusion.
obiwan1983 says
Got it. Thank you!!!!
John Moffat says
Great 馃檪
berlinda says
that was a good way to start. step by step tuition i like him.
accaquincy says
Very excellent. I now better understand the growth model and the gordon’s growth approximation. Great job. Example 6 was an excellent problem!!
fahim231 says
I dont understand the formula for working the average rate of growth out…..I am confused when he says the “4th root of 33,000/28,000 is 1.0419 as this is not the answer i get……….can some one please clarify please? thanks
John Moffat says
@fahim231, Divide 33 by 28, press equals, and then take the square root twice.
nickneouk says
Brilliant!
barkingspider says
Super Super Super. very articulate and easily understandable.
roberto1 says
Very clear lecture
gabi86 says
Hi thanks so much for this wonderful resource!am using open tuition for the first time and have just downloaded course notes for P4. Can I view the lectures on my blackberry bold 9700?
Thanks again.
soundharaya says
Great !!! Very simple and to the point
yogeshbvyas says
nice basic training for base F9 …. great work
lawer says
simply gud
mwachilale says
Very clear.
aurianne04 says
teaching made easy…thank you for the simplicity…this is so beautifully thought that i’m already feeling excited about this paper..thank you OP
hummerhead says
Impressive and simple.
siju says
Can you make the videos downloadable because we can not view it at proper speed / quality due to poor internet connection / speed and then many of the users in our part of the world may not have internet access from Home
ankamahjoseph says
Pls, i cant hear the sound of the video lecture.how do i copy the video so i can watch it offline.
admin says
check support page for help,
and videos are not downloadable
poonpoon says
Sir can the videos be downloaded? and the examples quoted are from which book.
musafaris says
i like cost of capital
kerr says
Cost of Capital at it’s basic. Very good