1. (Supernormal growth model) Gopalan Corporation has a current dividend of $1.00. The dividend is expected to grow at 40% annually for three years and then to grow thereafter at 5% per year. If the required return is 14%, what is the value per share?

2. (Expected dividend growth rate) Suppose MTA is expected to pay $4.00 in cash dividends next year at the rate of $1.00 per quarter and that the required return on MTA stock is 14%. If MTA is currently selling for $37.50 per share, what is the expected growth rate in dividends for MTA based on the constant growth model?