ADM 537 Workshop Five 5.3 Dropbox Stock Price Valuation
Background Information
In this assignment, you will complete problems using Excel to learn methods of calculating stock prices. The methods that will be covered are zero-growth dividends, constant-growth dividends, and two-stage dividend growth. You will apply concepts of the time value of money as you complete these calculations. These calculation tools will help solidify your understanding of the impact that a company’s dividend policy has on its stock price.
Instructions
1. In your textbook, Fundamentals of Corporate Finance, review:
a. Chapter 8, “Stock Valuation”
2. Review the Chapter 8 – Stock Valuation.pptx PowerPoint.
3. Using Excel, complete the following problems in the textbook:
a. Zero-Growth Dividends: Problem 18 on page 260
b. Constant-Growth Dividends: Problems 1, 7, and 9 on page 260
c. Two-Stage Dividend Growth: Problem 25 on page 262
4. Using a Word document, respond to Questions 4, 8, and 11 on page 259.
5. When you have completed your assignment, save a copy for yourself and submit a copy to your instructor using the Dropbox by the end of the workshop.
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