alleryStart learning →A firm expects D1 of Rs 6, with cost of equity 14% and constant growth 8%. What is the Gordon price?
ARs 42
BRs 100
CRs 75
DRs 120
Answer & Solution
Correct answer: B. Rs 100
Price = 6 / (0.14 - 0.08) = 6 / 0.06 = Rs 100.
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