1. Abc's company last dividend was $4.3. The dividend growth rate is to be constant at 30% for 2 years, after which dividends are expected to grow at a rate of 7% forever. The firms required return is (r)is 13%. What is its current stock price.

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Q U E S T I O N 1 S H O W W O R K I N E XC E L 1. ABC Company's last dividend was $4.3. The dividend growth rate is expected to be constant at 30% for 2 years, after which dividends are expected to grow at a rate of 7% forever. The firm's required return (rs) is 13%. What is its current stock price (i.e. solve for Po)? Note: Enter your answer rounded off to two decimal points. Do not enter $ or comma in the answer box. For example, if your answer is $12.345 then enter as 12.35 in the answer box. 1 points QUESTION 2 1. ABC Enterprises' stock is currently selling for $54 per share. The dividend is projected to increase at a constant rate of 3.1% per year. The required rate of return on the stock is 12%. What is the stock's expected price 5 years from today (i.e. solve for P5)? Note: Enter your answer rounded off to two decimal points. Do not enter $ or comma in the answer box. For example, if your answer is $12.345 then enter as 12.35 in the answer box. 1 points QUESTION 3 1. The common stock of ABC Industries is valued at $88.6 a share. The company increases their dividend by 12.9 percent annually and expects their next dividend to be $4.7. What is the required rate of return on this stock? That is, solve for r. Note: Enter your answer rounded off to two decimal points. Do not enter % in the answer box. For example, if your answer is 0.12345 then enter as 12.35 in the answer box. 1 points QUESTION 4 1. ABC is expected to pay a dividend of $5.5 per share at the end of the year. The stock sells for $64 per share, and its required rate of return is 18.5%. The dividend is expected to grow at some constant rate, g, forever. What is the growth rate (i.e. solve for g)? Note: Enter your answer rounded off to two decimal points. Do not enter % in the answer box. For example, if your answer is 0.12345 then enter as 12.35 in the answer box. 1 points QUESTION 5 1. A stock is expected to pay a dividend of $1.6 at the end of the year. The required rate of return is rs = 9.6%, and the expected constant growth rate is g = 7.7%. What is the stock's current price? Note: Enter your answer rounded off to two decimal points. Do not enter $ or comma in the answer box. For example, if your answer is $12.345 then enter as 12.35 in the answer box. 1 points QUESTION 6 1. If D0 = $4.7, g = 7.8%, and P0 = $67.9, what is the required rate of return on the stock? That is, solve for r. Note: Enter your answer rounded off to two decimal points. Do not enter % in the answer box. For example, if your answer is 0.12345 then enter as 12.35 in the answer box. 1 points QUESTION 7 1. ABC's last dividend paid was $1, its required return is 14.6%, its growth rate is 4.4%, and its growth rate is expected to be constant in the future. What is Sorenson's expected stock price in 7 years, i.e., what is P7? Note: Enter your answer rounded off to two decimal points. Do not enter $ or comma in the answer box. For example, if your answer is $12.345 then enter as 12.35 in the answer box. 1 points QUESTION 8 1. ABC's last dividend was $1.8. The dividend growth rate is expected to be constant at 26% for 3 years, after which dividends are expected to grow at a rate of 5% forever. If the firm's required return (rs) is 15%, what is its current stock price (i.e. solve for Po)? Note: Enter your answer rounded off to two decimal points. Do not enter $ or comma in the answer box. For example, if your answer is $12.345 then enter as 12.35 in the answer box. 1 points QUESTION 9 1. If D1 = $2, g (which is constant) = 2.4%, and P0 = $70.4, what is the required rate of return on the stock? That is, solve for r. Note: Enter your answer rounded off to two decimal points. Do not enter % in the answer box. For example, if your answer is 0.12345 then enter as 12.35 in the answer box. 1 points QUESTION 10 1. A stock just paid a dividend of D0 = $0.5. The required rate of return is rs = 14.3%, and the constant growth rate is g = 5.1%. What is the current stock price? Note: Enter your answer rounded off to two decimal points. Do not enter $ or comma in the answer box. For example, if your answer is $12.345 then enter as 12.35 in the answer box. 1 points QUESTION 11 1. ABC's stock has a required rate of return of 12.8%, and it sells for $60 per share. The dividend is expected to grow at a constant rate of 8.4% per year. What is the expected year-end dividend, D1? Note: Enter your answer rounded off to two decimal points. Do not enter $ or comma in the answer box. For example, if your answer is $12.345 then enter as 12.35 in the answer box. 1 points QUESTION 12 1. If D1 = $2.49 and P0 = $111.11, what is the dividend yield? Note: Enter your answer rounded off to two decimal points. Do not enter % in the answer box. For example, if your answer is 0.12345 then enter as 12.35 in the answer box. 1 points QUESTION 13 1. ABC just paid a dividend of D0 = $4. Analysts expect the company's dividend to grow by 33% this year, by 28% in Year 2, and at a constant rate of 6% in Year 3 and thereafter. The required return on this stock is 17%. What is the best estimate of the stock's current market value? Note: Enter your answer rounded off to two decimal points. Do not enter $ or comma in the answer box. For example, if your answer is $12.345 then enter as 12.35 in the answer box. 1 points QUESTION 14 1. The common stock of Wetmore Industries is valued at $44.1 a share. The company increases their dividend by 3.5 percent annually and expects their next dividend to be $1.4. What is the required rate of return on this stock? That is, solve for r. Note: Enter your answer rounded off to two decimal points. Do not enter % in the answer box. For example, if your answer is 0.12345 then enter as 12.35 in the answer box. 1 points QUESTION 15 1. ABC Inc., is expected to pay an annual dividend of $3.7 per share next year. The required return is 16.4 percent and the growth rate is 3.5 percent. What is the expected value of this stock five years from now? Note: Enter your answer rounded off to two decimal points. Do not enter $ or comma in the answer box. For example, if your answer is $12.345 then enter as 12.35 in the answer box. 1 points QUESTION 16 1. ABC Enterprises' stock is expected to pay a dividend of $1.2 per share. The dividend is projected to increase at a constant rate of 4% per year. The required rate of return on the stock is 14.4%. What is the stock's expected price 3 years from today (i.e. solve for P3)? Note: Enter your answer rounded off to two decimal points. Do not enter $ or comma in the answer box. For example, if your answer is $12.345 then enter as 12.35 in the answer box