alleryStart learning →A share pays a constant Rs 2 dividend forever with no growth. At a 10% required return, its value is?
ARs 22
BRs 20
CRs 2
DRs 200
Answer & Solution
Correct answer: B. Rs 20
With zero growth the dividend is simply capitalised at the required return: 2 / 0.10 = Rs 20.
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