Can someone explain question 40 afternoon 2012 Mock CFAI? afternoon, question, someone, anybody

giants2010

Rearranging the formula to solve for g = r - d / 1 + d?
I’ve seen g = r - (D1 / Po)
I don’t think I’ve seen it done this way, can anybody preference a page, etc? I might be overlooking this.

grharmeyer

for what it’s worth, unless finding the value of r or g (from GGM) is an intermediate step, i just go by trial and error (from the answers provided) into the basic formula.

prav_Cfa7

That’s what I do usually, but I don’t think they gave price in the problem?

hariRaj

if dividend yield is 5%, you can use Do as 0.05 and Po as 1.