1.(DDM) Boogey, Inc has recently paid an annual cash dividend of $1.50 and plans to continue to grow its dividend payouts at a rate of 2% per year. Bogey, Inc. has a cost of equity of 11%. What is the intrinsic value of Bogey's common stock? 2. (DDM) Fedder, Inc, a local mining company, has recently paid an annual cash dividend of $1.50 but plans to continue to grow its dividend payouts at a decreasing rate of 5% per year. Fedder, Inc. has a cost of equity of 15%. What is the intrinsic value of Fedder's common stock? 3. (Stock valuation) Janice plans to buy 300 shares of common stock today and sell it in six years. If she can invest in a similar stock with a cost of equity of 13.5%, what is the maximum that she should be willing to pay for each share of this stock? 4. (uneven cash flows) Martha will pay $30 today and expects to receive the following dividends from the purchase of the stock Year Dividends 0 -$30 1 $2.00 2 $1.00 3 $2.10 4 0 5 0 6 $2.10 +P At what price does Martha expect to sell the stock for in six years of she faces an opportunity cost of 11.5%? 5. (DDM estimation of growth rate) CattyTreat, a partnership for providing cosmetic services for cats, has paid the following dividends to its shareholders in the past. It plans to continue to pay dividends in the future using the same historical growth rate. As a relatively risky venture, its stock has a beta coefficient of 3.0, a market risk premium of 7.5%, and a risk-free rate of 3.0%. If the market is expected to perform in the way that it has and CattyTreat is expected to continue to employ the same dividend policy in the future, what should its stock sell for today? Year Dividend 0 $2.00 -1 $2.00 -2 $2.00 6. (DDM w/dual growth rates) Tech Inc, a regional technology manufacturer plans to roll out a new product to gain market share. This expansion is expected to capture a significant share of the market for the next three years. Afterwards, its free cash flows are expected to taper. Tech, Inc. has just paid a cash dividend of $2.00 and is expected to increase its payout by 25% for the next three years. Afterwards, its dividends are expected to grow at 2% indefinitely. Tech has a required return of 15%. a. Draw a free cash flows diagram of its dividends. b. What is Tech's value? c. If the market value of Tech is $30, should it be purchased ? Explain. 7.(Free Cash Flow Model) A firm has forecasted free cash flows as follows: Year Free Cash Flows(millions$) 1 100 2 -250 3 250 4 -300 5 350 The firm has $500 mil in short term investments; $100 million in preferred stock, and $300 million in corporate bonds. There are 20 million shares of common stock outstanding. If the form has a weighted average cost of capital of 13%, what is the intrinsic value of the common stock? Please show work for ALL answers!