1. Metroplex Corporation will pay a $3.10 per share dividend next year. The company pledges to increase its dividend by 4.80 percent per year indefinitely. Required: If you require an 8.00 percent return on your investment, how much will you pay for the company's stock today?

$100.75

$93.00

$92.44

$96.88

$23.11

2. Suppose you know a company's stock currently sells for $90 per share and the required return on the stock is 13 percent. You also know that the total return on the stock is evenly divided between a capital gains yield and a dividend yield.

Required:

If it's the company's policy to always maintain a constant growth rate in its dividends, what is the current dividend per share?

$5.85

$5.22

$5.49

$10.99

$5.92

3. Marcel Co. is growing quickly. Dividends are expected to grow at a 22 percent rate for the next 3 years, with the growth rate falling off to a constant 7 percent thereafter.

$53.22

$54.29

$47.70

$50.28

$52.16

Required:

If the required return is 14 percent and the company just paid a $2.40 dividend. what is the current share price? (Do not round your intermediate calculations.)