1)

Apocalyptica Corp. pays a constant $8.50 dividend on its stock. The company will maintain this dividend for the next 11 years and will then cease paying dividends forever. If the required return on this stock is 12 percent, what is the current share price?

Current share price

$

2)Plush Pilots, Inc., has balance sheet equity of $6.4 million. At the same time, the income statement shows net income of $950,000. The company paid dividends of $485,000 and has 190,000 shares of stock outstanding. If the benchmark PE ratio is 16, what is the target stock price in one year?

Target stock price

$