Corporate Finance (4th Edition) (Pearson Series in Finance) - Standalone book
Corporate Finance (4th Edition) (Pearson Series in Finance) - Standalone book
4th Edition
ISBN: 9780134083278
Author: Jonathan Berk, Peter DeMarzo
Publisher: PEARSON
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Chapter 9, Problem 8P

Canadian-based mining company EI Dorado Gold (EGO) suspended its dividend in March 2016 as a result of declining gold prices and delays in obtaining permits for its mines in Greece. Suppose you expect EGO to resume paying annual dividends in two years time, with a dividend of $0.25 per share, growing by 2% per year. If EGO's equity cost of capital is 10%, what is the value of a share of EGO today?

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Corporate Finance (4th Edition) (Pearson Series in Finance) - Standalone book

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