1A)

Company Z's earnings and dividends per share are expected to grow indefinitely by 5% a year. Assume next year's dividend per share is $18 and next year's EPS is $5. The market capitalization rate is 15%. If Company Z were to distribute all of its earnings, it could maintain a level dividend stream of $5 a share. How much is the market actually paying per share for growth opportunities? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

Present Value Growth Opportunities :

1B)

Company Y does not plow back any earnings and is expected to produce a level dividend stream of $5.6 a share. If the current stock price is $40.6, what is the market capitalization rate? (Enter your answer as a percent rounded to 2 decimal place.)

Market Capitalization Rate % :

1C)

Company Z's earnings and dividends per share are expected to grow indefinitely by 5% a year. If next year's dividend is $9 and the market capitalization rate is 15%, what is the current stock price? (Round your answer to 2 decimal places.)

Stock Price :

1D)

Company Z-primes earnings and dividends per share are expected to grow by 2% a year. Its growth will stop after year 4. In year 5 and afterward, it will pay out all earnings as dividends. Assume next years dividend is $10, the market capitalization rate is 12% and next years EPS is $17. What is Z-primes stock price? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

Stock Price :