1. A stock is trading at $60 per share. The stock is expected to have a year-end dividend of $5 per share (D1 = $5), and it is expected to grow at some constant rate g throughout time. The stock's required rate of return is 12% (assume the market is in equilibrium with the required return equal to the expected return). What is your forecast of g? Round the answer to three decimal places.

2.Crisp Cookware's common stock is expected to pay a dividend of $2.5 a share at the end of this year (D1 = $2.50); its beta is 0.80; the risk-free rate is 4.1%; and the market risk premium is 6%. The dividend is expected to grow at some constant rate g, and the stock currently sells for $32 a share. Assuming the market is in equilibrium, what does the market believe will be the stock's price at the end of 3 years (i.e., what is )? Do not round intermediate steps. Round your answer to the nearest cent.

3.

What is the required rate of return on a preferred stock with a $50 par value, a stated dividend of 10% of par, and a current market price of (a) $54, (b) $89, (c) $101, and (d) $132 (assume the market is in equilibrium with the required return equal to the expected return)? Round the answers to two decimal places.

a. %

b. %

c. %

d. %

4. Brushy Mountain Mining Company's coal reserves are being depleted, so its sales are falling. Also, environmental costs increase each year, so its costs are rising. As a result, the company's earnings and dividends are declining at the constant rate of 5% per year. If D0 = $6 and rs = 18%, what is the value of Brushy Mountain's stock? Round your answer to the nearest cent.