1. The outstanding common stock of MStar Electric paid a dividend of $3 per share last year, and dividends are expected to increase at a rate of 5 percent per year. If the required rate of return is 10 percent, what is the stock worth today? 2. Suppose you know that a company's stock currently sells for $42 per share and the required return on the stock is 10 percent. You also know that the total return on the stock is evenly divided between a capital gains yield and a dividend yield. If the company's policy is to always maintain a constant growth rate in its dividends, what is the current dividend per share? Use this information to answer questions 3-5 Cash flows from two investment opportunities are given below and the cost of capital is 10%. Year CF CF 0 -$1,000 -$1,000 1 + $100 + $800 2 + $200 + $300 3 + $400 + $300 4 + $700 + $200 5 + $800 + $200 3. What is the NPV of each investment? 4. What is the IRR for each investment? 5. What is the appropriate investment choice if (i) the investments are mutually exclusive, or (ii) the investments are independent