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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FM Exams › sir Regarding value of equity share
sir if dividend are constant and no growth then will the share price be constant ie in year 0 year 1 year 2 year 3 ?
Yes, there is no reason for it to change given that the expectations of future dividends is not changing (assuming, of course, that the shareholders required rate of return does not change in the future, but we would always assume that to be the case).
what about when there is Growth?
Your original question asked about when there was no growth.
If there is growth then the share price will grow at the same rate as the dividend growth. I do explain this in my free lectures, and I did explain again in my answer to another recent post from you.