1. A company has a net income of $50 million. Its liabilities are $100 million. It has shareholders' equity of $300 million. If the company has a 25 percent payout ratio, what is its internal growth rate?
2. DEF Inc. has a 7 percent, semiannual coupon bond outstanding with a current market price of $1,047.50. The bond has a par value of $1,000 and a yield to maturity of 6 percent. How many years is remaining until this bond matures?
3. ABC Inc. is growing quickly. The company just paid a dividend of $2.85. The company expects to increase the dividends at 10 percent rate per year for the next 5 years. Afterwards, the growth rate will fall to a constant 5 percent per year thereafter. If the required return is 14 percent, what is the current share price?