The Last Dividend Paid by Klein Company Was R1

question 68

Multiple Choice

The last dividend paid by Klein Company was R1.00.Klein's growth rate is expected to be a constant 5 percent for 2 years, after which dividends are expected to grow at a rate of 10 percent forever.Klein's required rate of return on equity (rs) is 12 percent.What is the current price of Klein's ordinary shares?

• A) R21.00
• B) R33.33
• C) R42.25
• D) R50.16
• E) R58.75

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