$(10)$ Finally, assume that Bon Temps's earnings and dividends are expected to decline at a constant rate of $4\%$ per year, that is$,g=-4\%.$ Why would anyone be willing to buy such a stock, and at what price should it sell? $(11)$ What would be its dividend and capital gains yields in each year?

$g$

$D_0$

$r_5$

$P_0$

DY $1$

$CG{Y}_1$

$(12)$ Suppose Bon Temps decided to issue preferred stock that would pay an annual dividend of $$5$ and that the issue price was $$100$ per share. What would be the stock's expected return?

Perpetual:

$D_p$

$P_p$