1. Tpsis is expected to grow at a constant rate of 6% a year into the indefinite future. Its next dividend is expected to be $2.25 a share. The rate of return on stocks similar to Tpsis is about 11%. What should a share of Tpsis sell for today? *

5 points

a) $43

b) $45

c) $46

d) $50

e) None of the above

2. Saman Co. has an issue of preferred stock outstanding that pays a $5.50 dividend every year in perpetuity. If the required return of this stock is 5%, what is the selling price per share? *

3 points

a) $110

b) $112

c) $113

d) $114

e) None of the above

3. Nana Corporation just paid a dividend of D0 = $0.75 per share, and that dividend is expected to grow at a constant rate of 4.50% per year in the future. The company's beta is 1.25, the required return on the market is 10.50%, and the risk-free rate is 4.50%. What is the company's current stock price? *

5 points

a) $10.45

b) $10.89

c) $12.26

d) $12.64

e) None of the above

4. Choco Inc.'s stock has a required rate of return of 11.50%, and it sells for $30.00 per share. Choco's dividend is expected to grow at a constant rate of 7.00%. What was the last dividend, D0? *

5 points

a) $0.95

b) $1.05

c) $1.16

d) $1.26

e) None of the above