Show your work, calculations and any formulas used

1.General Products had net income of $3.15/share last year, and it paid $1.88/share in dividends last year. A) What was its Dividend Payout Ratio last year? B) What was its Retention Rate last year? (Your answers should be a % carried to one place.)

2.General Products' current stock price is $52.61/share. You expect a dividend of $1.97/share will be paid over the next year and believe net income will increase at a 3.2% annual rate in the future. What is your estimate for General Products' Cost of Equity? (Your answer should be a % carried to 1 place.)

3.You believe that RE Corp will pay a dividend of $1.41/share next year. If you estimate RE's Cost of Equity is 8.7% and you expect RE's net income (and dividends) will grow 5.2%/year in the future, what is your estimate of RE's true value per share?

4.C&D Corp's stock is selling for $45/share. You expect dividends to be $.57/share over the next year (Year 1), $.63/share in Year 2 and $.69/share in Year 3, and you anticipate the stock will be trading at $65/share at the end of Year 3.

a.Draw a timeline assuming all cash flows occur at the end of each year.

b.If you have estimated C&D Corp's Cost of Equity to be 7.8%, what do you believe the true value of the stock is today?

c.Given your answer to 4. b., what would you recommend to your clients?

5.On average, C&D Corp can earn 10%/year after tax on new investments. If its dividend payout ratio averages 25%, how fast would you expect its net income to grow/year? (Your answer should be a % carried to 1 place.)