Answer:
Growth rate = 16.36%
Explanation:
The growth in EPS can be worked out using the average growth rate method.
Under this method the earliest EPS and the latest EPS are compared and average growth over the 5 years period is worked out.
This can be done using the formula below:
g= (EPSn/EPSo)1/n - 1
g - growth rate in EPS
EPSn- latest EPS
EPSo- Oldest EPS
n- number of years
g=(3.20/1.50)^1/5 - 1
g= 1.163621518 - 1
g= 0.163621518 × 100
g= 16.36%
Growth rate = 16.36%
