Definition for : Gordon-Shapiro formula
GLOSSARY LETTER
The Gordon-Shapiro formula calculates the Value of a Perpetuity growing at a constant rate g: PV = F/(k-g), where PV is the Present value of this Perpetuity, F – the Perpetuity, k – Cost of capital. (k>g)
(See Chapters 16 and 32 of the Vernimmen)
To know more about it, look at what we have already written on this subject