1.) You are currently thinking about investing in a stock valued at $25 per share. The stock recently paid a dividend of $2.60 and its dividend is expected to grow at a rate of 6 percent for the foreseeable future. You normally require a return of 16 percent on stocks of similar risk. Is the stock overpriced, underpriced, or correctly priced? (Round answer to 2 decimal places, e.g. 52.75.)

Current value of stock:

2.)Wildhorse Manufacturing Company has been growing at a rate of 8 percent for the past two years, and the CEO expects the company to continue to grow at this rate for the next several years. The company paid a dividend of $1.20 last year. If your required rate of return is 15 percent, what is the maximum price that you would be willing to pay for this companys stock? (Round intermediate calculation and final answer to 2 decimal places, e.g. 15.25.

Maximum price:

3.)You are interested in buying the preferred stock of a bank that pays a dividend of $1.40 every quarter. If you discount such cash flows at 8 percent, what is the value of this stock?

Value of the stock:

4.) The First Bank of Flagstaff has issued perpetual preferred stock with a $100 par value. The bank pays a quarterly dividend of $1.65 on this stock. What is the current price of this preferred stock given a required rate of return of 12.0 percent? (Round answer to 2 decimal places, e.g. 15.25.)

Current price:

5.) Crane, Inc., is a mature firm that is growing at a constant rate of 5.62 percent per year. The last dividend that the firm paid was $1.60 per share. If dividends are expected to grow at the same rate as the firm and the required rate of return on Cranes stock is 13 percent, what is the market value of the companys stock? (Round answer to 2 decimal places, e.g. 52.75.)

Market value of the companys stock: