2. Stock valuation methods: Dividend discount model Suppose Crystal just bought stock in SolarHeat Co., a renewable energy startup, and that Crystal estimates there will be a dividend of $9 per share, paid annually, forever. If the discount rate on the stock is 10 percent, then using the discount dividend model, the value of the stock is: $78.30 per share $90.00 per share $93.60 per share $98.10 per share Now suppose Crystal estimates that there will be a dividend of $9 per share paid out next year, and that the dividend is expected to grow at a constant rate of 3 percent per year. If the required rate of return on the stock is 10 percent, then using the discount dividend model, the value of the stock is: $114.43 per share $128.57 per share \$132.43 per share $136.28 per share Which of the following are limitations to the dividend discount model? Check alf that appiy.. It cen result in inaccurate valuations when the dividends to be paid in the next year are incorrectly estimated. It assumes that uncertahty cannot be accounted for because it doest tallow expectations about a firms cash flows to change. It can result in inaccurate valuations when the firm being evaluated retains most of its earnings, rather than distributing them as dividends. It can result in inaccurate valuations when the firm being evaluated retains a small percentage of its earnings, distributing most of them as dividends