9000  REM *****EQUITY*****BUSINESS PROGRAM
9005  REM EQUITY**********VERSION #1 (7/31/69)*****COST OF EQUITY CAPITAL****
9010  REM
9015  PRINT "*  COST OF EQUITY CAPITAL  *"
9020  PRINT 
9025  PRINT 
9030  PRINT "THIS PROGRAM WILL COMPUTE THE COST OF EQUITY CAPITAL BY COMPUTING DIVI-"
9035  PRINT "DENDS AND THE SHARE PRICE FOR FUTURE PERIODS, (BASED ON THE GORDON "
9040  PRINT "MODEL), AND THEN FIND THE DISCOUNT RATE BY EQUATING THE PRESENT VALUE"
9045  PRINT "OF THE STREAM TO THE CURRENT SHARE PRICE."
9050  PRINT 
9055  REM
9060  REM     THE VARIABLES ARE DEFINED AS FOLLOWS:
9065  REM   D(I) = DIVIDEND IN PERIOD I
9070  REM    N   = NUMBER OF GROWTH SEGMENTS
9075  REM   G(I) = GROWTH RATE IN DPS PER SEGMENT I
9080  REM   B(I) = BEGINNING PERIOD OF SEGMENT I
9085  REM   L(I) = FINAL PERIOD OF SEGMENT I
9090  REM    Q   = INDICATOR FOR RERUN OPTIONS
9095  REM    R   = COST OF CAPITAL
9100  REM    
9105  DIM D[100]
9110  DIM L[20],B[20],G[20]
9115  LET Q=S1=0
9120  IF Q=1 THEN 9145
9125  PRINT 
9130  PRINT "PLEASE ENTER THE CURRENT PRICE/SHARE, AND DIVIDEND/SHARE";
9135  INPUT P,D[1]
9140  IF Q=2 THEN 9200
9145  PRINT 
9150  PRINT "HOW MANY GROWTH SEGMENTS ARE THERE";
9155  INPUT N
9160  PRINT 
9165  PRINT "FOR EACH GROWTH SEGMENT, ENTER THE GROWTH RATE IN DECIMAL, & THE LAST"
9170  PRINT "EFFECTIVE PERIOD FOR EACH SEGMENT."
9175  FOR I=1 TO N
9180  PRINT "SEGMENT";I;
9185  INPUT G[I],L[I]
9190  NEXT I
9195  PRINT 
9200  LET R=0
9205  LET B[1]=1
9210  REM IF N=1, THEN THE COST CAN BE FOUND ANALYTICALLY
9215  IF N=1 THEN 9365
9220  FOR I=1 TO N-1
9225  FOR J=B[I] TO L[I]
9230  LET D[J+1]=D[J]*(1+G[I])
9235  NEXT J
9240  LET B[I+1]=L[I]+1
9245  LET R=R+G[I]
9250  NEXT I
9255  GOSUB 9375
9260  PRINT 
9265  IF S1=1 THEN 9285
9270  PRINT "************************************************************************"
9275  LET S1=1
9280  GOTO 9290
9285  PRINT "                          ------------------"
9290  PRINT 
9295  PRINT "A SHARE PRICE OF $";P;", DIVIDEND OF $";D[1];", AND INITIAL GROWTH ";
9300  PRINT "RATE OF";G[1]*100;"%, YIELD A COST OF EQUITY CAPITAL OF";R;"PERCENT."
9305  PRINT 
9310  PRINT "                         ---------------------"
9315  PRINT 
9320  PRINT "DO YOU WISH TO RUN SOME DIFFERENT DATA?"
9325  PRINT "ENTER '0' FOR ALL NEW INFORMATION."
9330  PRINT "ENTER '1' FOR SAME SHARE PRICE & DIVIDEND, NEW GROWTH RATES OR PERIODS."
9335  PRINT "ENTER '2' FOR SAME GROWTH RATES & PERIODS, NEW SHARE PRICE OR DIVIDEND."
9340  PRINT "ENTER '3' TO TERMINATE.    ";
9345  INPUT Q
9350  PRINT 
9355  IF Q=3 THEN 9515
9360  GOTO 9120
9365  LET R=100*(D[1]/P+G[1])
9370  GOTO 9260
9375  LET R=(R+G[N])/N+D[1]/P
9380  LET M=0
9385  LET R=R-.55
9390  LET D1=1
9395  FOR I=1 TO 13
9400  LET R=R+D1
9405  LET M=M+1
9410  LET D1=.5*D1
9415  LET R=R-D1
9420  LET F=1
9425  IF M>100 THEN 9500
9430  IF R=-1 THEN 9480
9435  LET Z=-P
9440  FOR J=1 TO L[N-1]
9445  LET F=F/(1+R)
9450  LET Z=Z+D[J]*F
9455  NEXT J
9460  IF R<G[N] THEN 9400
9465  LET Z=Z+D[L[N-1]]*F/(R-G[N])
9470  IF Z<0 THEN 9415
9475  NEXT I
9480  LET R=100*R
9485  REM   NEXT LINE ROUNDS R OFF
9490  LET R=(INT(100*R+.5))/100
9495  RETURN 
9500  PRINT 
9505  PRINT "TOO MANY ITERATIONS. LAST COST WAS";R*100;"PERCENT WITH VALUE $";Z
9510  GOTO 9305
9515  PRINT 
9520  PRINT "********************************************************************"
9999  END 
