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respected tutor
D0(1+g) shows dividend in one year time. if dividend after one year is suppose 0.2$ (given in question) and rate of growth is 5 % in subsequent years should we discount 0.2 with one year discount factor?
cost of equity is 12 %.2/(.12-.05)=2.857 * 0.893=2.55
please clarify…
I am pleased that you have now got this 🙂
(I assume that you are watching the free lectures that go with the lectures notes? Using the notes on their own is pointless because they are only lecture notes – it is in the lectures that I explain and expand on the notes. If you are not watching the lectures then you must buy a Study Text from one of the ACCA approved publishers and study from there.)
i am preparing from your lectures and notes so don’t feel need of study text. but i do have revision kit.
thank you
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