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1. If you pay $55 for the preferred stock in problem that pays a S3.25 dividend what would be your expected return? 2. How much

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1. If you pay $55 for the preferred stock in problem that pays a S3.25 dividend what would be your expected return? 2. How much would you pay for a share of common stock that just paid a $1 dividend, it is expected to grow 4% this next year? You plan to sell it for $35 at the end of the year. Your required return is 10%. . Would you pay $72 for a share of common stock that just paid a $2.15 dividend, its expected growth rate indefinitely is 5% and your required return is 11%? 4. How much would you pay for a share of common stock that just paid a $1.63 dividend? The firm will grow at 7% for the next one year. Then the firm will settle in at a 5% growth rate that will last indefinitely. Your required return is 8%. s. If you pay S81 for a share of common stock that has a constant growtlh rate of 7% and it is expected to pay a dividend of $2.89 what would be your return? 6. Determine the value of Red River's stock. The EPS last year was $3.50. The company's payout ratio is 40% and the ROE is 12%. RR's beta is 1.1. Assume a risk-free rate of 2% and an expected return on the market of 10%

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