1. A firm will pay a common stock annual dividend of $3.00 next year. The annual required return on common stock is 14 percent. The firm has a constant growth rate of 6 percent per year indefinitely. Compute the current price of the stock. 2. A company just paid $4.00 annual dividend. The firm has a stock price of $60, and a constant growth rate of 5 percent a year forever. Compute the annual required rate of return. 3. Suppose a firm is expected to pay an annual dividend next year of $4.00 per share. Both sales and profits for the company are expected to grow at a rate of 25 percent in year 2 and year 3 and then at 5 percent per year. 4. A company has just paid an annual dividend of $5.00 per share. The company will increase its dividend by 30 percent next year. The firm will then reduce its dividend growth rate by 6 percent each year until the dividend reaches the industry average of 6 percent growth. The firm will then maintain that dividend growth rate forever. The annual required rate of return for the company is 14 percent. Find the price of the stock. 5. The preferred stock of XYZ Corp. pays a fixed annual dividend of $6 per share. The annual required rate of return on the preferred stock is 10 percent. Compute the price of the preferred stock.