Finance (common stock)
posted by Help Please .
I need a formula for:
A share of common stock of xyz ltd is expected to pay no dividends until next 2 years but at the end of year 2 it will pay $2 as dividends. Dividends are expected to grow at 4% per annum into indefinite future. Assume that the required expected ROR on xyz's common stock is 14%.
Find the current price per share of the stock.