The ordinary shares of Emerald Ltd paid a dividend of $1.55 last year. Dividends are expected to have a growth rate of 6%p.a. If Emerald share current market price is $24.50 and your required rate of return is 10.5%p.a.,
(a) Calculate the value of the share to you.
(b) Should you purchase Emerald ordinary shares? (Give a reason for your answer.)
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