present value of a growing perpetuity
growingperpetuity(cash, rate, growth)
amount the perpetuity will pay one period from now
growth rate in the payments
The function growingperpetuity computes the present value of a perpetuity paying the amount cash one period from now, with increasing payments at the end of each periods. The payments increase according to the growth rate.
Since growingperpetuity used to be part of the (now deprecated) finance package, for compatibility with older worksheets, this command can also be called using finance[growingperpetuity]. However, it is recommended that you use the superseding package name, Finance, instead: Finance[growingperpetuity].
I hold some shares of the XYZ company. I will receive dividends each year. The next dividend is expected to be 1.5 units per share, one year from now. The yearly dividends are expected to increase by 2% per year, for the foreseeable future What is the present value, per share, of the dividend payments, given that the discount rate is 11%?
The Finance[growingperpetuity] command was introduced in Maple 15.
For more information on Maple 15 changes, see Updates in Maple 15.
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