21) The common stock of Juffy Corp is expected to pay a dividend of $4.00 at the end of the year. The dividend is expected to grow at 4% per year forever. Investors require a 12% return to hold the stock. What price would you expect for this stock?

Select one:

a.$25.00

b.$30.00

c.$35.00

d.$40.00

e.$50.00

22) A common stock of Verity Inc. just paid a dividend of $1.50. The dividend is expected to grow at 4% forever. The market currently requires a return of 15% to hold assets of this risk. What price should the stock sell for?

Select one:

a.$14.18

b.$15.60

c.$16.00

d.$16.45

e.$10.73

23) Genu corporation stock just paid an annual dividend of $2.20 a share and is expected to increase that amount by 5% per year. How much should you expect to pay per share if the market rate of return for this type of security is 9% at the time of your purchase? Select one:

a.$80.00

b.$84.75

c.$43.57

d.$57.75

24) XYZ company just paid a dividend of $2.50. It is expected to increase its dividend by 3% per year. If the stock sells for $34, what is the required rate of return on assets of this risk? Select one:

a.11.57%

b.4.96%

c.4.57%

d.10.57%

25) Compute the PV of a level-payment perpetuity with monthly payments of $1,000, given an annual discount rate of 4%?

Select one:

a.$250,000

b.$175,000

c.$275,000

d.$200,000

e.$300,000