Saturday, November 8, 2008

A Q/A Session

I am a student of FIN 254. Section 10. I am having a problem with question no 9, chapter 8. How should I compute the last dividend that has 11% rate of return thereafter. Should I use the formula of zero growth rate? Then what is the amount in D (in the formula). Please help me out sir.

=> As mentioned in the problem, D0 is $3.50. You would need to use D6 to apply 11% rate of return. It is also mentioned that, dividends would grow by 5% forever. That means, D6=D0(1+g)^6.

3 comments:

Anonymous said...

How r you sir:)
I got a question.What are the finance softwares that most firms use? Please name couple of them so that i can practice it at home. Is it only excel? is it MS accounting? Which one is the most popular? Which ones are most preferred in bangladeshi firm-in home and abroad? Can I be efficient in them within two years?

Sincerely, always yours:) Mushtahir(Anondo)

Anonymous said...

Sir,
I have a question related to chapter 10, FIN254. I am not clear with the question of problem 13. How should I proceed in problem 13? What should be the steps? Looking forward to your reply. Thank you.

Anonymous said...

Sir
problem 13 & 14 of chapter 10 is related to 10.6 (page 321) that we didn't cover in the class. That is why I am confused how to evaluate this project. Do we need this these two project evaluation?