What is the implied growth duration of Bowe Industries given the following:
$\begin{array}{lcc}
& \text { S\&P Industrials } & \text { Bowe Industries } \
\text { P/E Ratios } & 15 & 25 \
\text { Average Growth (\%) } & 5.0 & 15.0 \
\text { Dividend Yield } & n 6 & n 2
\end{array}$
A) 3.2 years
B) 6.6 years
C) 8.6 years
D) 9.7 years
E) 10.6 years

Question

What is the implied growth duration of Bowe Industries given the following:
$\begin{array}{lcc} 
& \text { S\&P Industrials } & \text { Bowe Industries } \
 \text { P/E Ratios } & 15 & 25 \
\text { Average Growth (\%) } & 5.0 & 15.0 \
\text { Dividend Yield } & n 6 & n 2
\end{array}$
A) 3.2 years
B) 6.6 years
C) 8.6 years
D) 9.7 years
E) 10.6 years

Quizplus · Accepted Answer

ln (25/15)= T ln [1 + .15 + .02)/(1 + .05 + .06)]
T = 9.7 years

What Is the Implied Growth Duration of Bowe Industries Given