1) Stock Y is selling at $25. Its predicted dividend payment next period is $0.5 per share, and its dividend payment is expected to grow at 5%. If the stock is fairly priced, what is the expected rate of return for the stock?

Select one:

a.7%

b.7.5%

c.8%

d.7.1%

2) Suppose a company's expected dividends are $1, $2, and $3 for the next three years and are expected to grow at a constant rate of 5% per year thereafter. If the required rate of return is 12%, what is the expected price for the stock at Year-end 3 (P3)?

Select one:

a.$42

b.$45

c.$42.61

3) Suppose a company's expected dividends are $1, $2, and $3 for the next three years and are expected to grow at a constant rate of 5% per year thereafter. If the required rate of return is 12%, what is the current estimated intrinsic value for the stock(P0)?

Select one:

a.$42

b.$36.65

c.$45

d.$48