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An analyst applies the constant-growth dividend discount model with D1 = Rs 4, expected growth g = 5% and required return k = 12%. The intrinsic value per share is:
ARs 33.33
BRs 80.00
CRs 57.14
DRs 36.36
Answer & Solution
Correct answer: C. Rs 57.14
1. Identify what the question asks: this concept maps to dividendgrowthmodel (§1.1).
2. Apply the framework or formula relevant to the topic.
3. Eliminate distractors and arrive at the correct option (C).
_Source: ICAI BoS CA Final Paper 2, Ch 4 "Security Analysis"_
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