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November 29, 2021 at 10:20 pm
Mr. Moffat, when calculating the figure of shareholders expected return, MUST we express all the figures in CENTS OR DOLLARS??????? I am confused……
November 29, 2021 at 10:30 pm
Nevermind, I confirmed the figures myself with recalculation, I am truly sorry for disturbing the class, I truly apologize……… I really wish there was a delete option, I am truly sorry for the disturbance
November 1, 2021 at 9:30 am
If a company paid no dividend and instead re-invested all earnings in growth then how would the Cost of Equity / market value be determined?
John Moffat says
November 1, 2021 at 10:50 am
It would still be the present value of expected future dividends and investors will be expecting dividends at some time in the future even if it is not next year.
April 18, 2021 at 2:30 pm
@altun: I know it’s a late reply but it would be better if you repost this in the Ask the FM Tutor Forum :)!
March 5, 2020 at 11:36 am
Dear Mr John,
Thank you very much for your effort and i really appreciate the way you explain on every aspect in this Subject.
March 5, 2020 at 2:50 pm
Thank you for your comment 🙂
August 27, 2019 at 11:45 pm
Thank you for all your hard work and making this resource available free of charge.
Just to let you know in the lecture notes (for Sep-Dec 2019 exam) you need to correct a typo in the answer for chapter 17 example 2. Currently it says Do is 30c but it should be 40 (the answer is the same though).
August 28, 2019 at 11:51 am
Thank you for letting me know (and thank you for your comment).
August 20, 2019 at 5:47 am
I think the answer in example 6 is wrong.
In example 6, I can indicate that the dividend payout ratio is 0.2/0.32 = 37.5%.
I think that the proportion retained should be b = 100 – 37.5 = 62.5%.
August 20, 2019 at 6:07 am
No – the answer is correct.
The dividend payout ratio is indeed 020/0.32, but that is not equal to 37.5% !! It equals 62.5%, and so the proportion retained is 100 – 62.5 = 37.5%.
August 6, 2019 at 12:35 pm
Sir are this online notes are enough to study for ….or do we have to study from kaplan textbook as well …
August 6, 2019 at 3:25 pm
Provided that you are watching the free lectures that work through the lecture notes, then you do not really need the Study Text – they are a complete free course and cover everything needed to be able to pass the exam well.
The book that is essential is the Revision Kit because it contains lots of past exam (and other exam standard) questions. Question practice is vital to passing the exam.
August 4, 2019 at 8:05 am
Are the lecture videos available to download as well?
August 4, 2019 at 10:05 am
No – they can only be watched online.
July 26, 2019 at 9:50 am
In example 6, why the market value of shares grow at the same rate of dividend, but not the required rate of return?
July 26, 2019 at 4:59 pm
The market value is always the present value of the future expected dividends.
If we go forward a year in time, then the future dividends will all be higher by the dividend growth rate, and therefore the present value in a years time will also be higher by the same dividend growth rate.
(the required rate of return depends on the general rates of return in the country and the riskiness of the shares – it does not depend on the dividend growth rate)
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