Micro Corp. are experiencing supernormal growth. The firm’s board of directors recently paid a dividend of $5.10 per share. It is expected that this dividend will grow at a super rate of 30% for next three years after which the growth rate will level off to a constant 5% forever. The required rate of return is given as 15%.
Please show calculations for the the following:
a. Find the current price of this share (P0)
b. Calculate Dividend Yield and Capital gains yield today
