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bento co (c) DVM

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AFM Exams › bento co (c) DVM

  • This topic has 1 reply, 2 voices, and was last updated 7 years ago by AvatarJohn Moffat.
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  • July 12, 2018 at 8:07 am #461701
    Avatarvinty
    Member
    • Topics: 47
    • Replies: 22
    • ☆☆

    Can we use Gordon growth model to calculate the growth rate instead of historic data?if not,then please explain the logic why not to use. Thanks in advance

    July 12, 2018 at 10:42 am #461741
    AvatarJohn Moffat
    Keymaster
    • Topics: 57
    • Replies: 54837
    • ☆☆☆☆☆

    The answer is not using historic data at all !!!

    The last paragraph of the question tells you specifically what the future dividends will be, and to use any other approach would therefore be wrong.

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