1. A companys dividend grows at a constant rate of 5 percent p.a.. Last week it paid a dividend of $1.47. If the required rate of return is 16 percent p.a., what is the price of the share 4 years from now? (round to nearest cent)

Select one:

a. $17.06

b. $16.24

c. $9.42

d. $25.41

2. After paying a dividend of $1.90 last year, a company does not expect to pay a dividend for the next year. After that it plans to pay a dividend of 6.69 in year 2 and then increase the dividend at a rate of 3 percent per annum in years 3 to 6. What is the expected dividend to be paid in year 5? (to nearest cent; don't include $ sign)

3. You are interested in investing in a company that expects to grow steadily at an annual rate of 3 percent for the foreseeable future. The company just paid a dividend of $4.04. If your required rate of return is 18 percent p.a., what is the most you would be willing to pay for this share? (Round to the nearest cent; don't use $ sign.)