5) Estimate the cost of equity (rE) two different ways: a) Discount Dividend Model (DDM) See Exhibit 2.

i) What is the current annual (yearly) dividend (D0)? Current annual dividend = X

ii) Calculate annual dividends for the past several years. Is there an approximate pattern to the dividends? Are the dividends constant, growing, or uneven? X

iii) If you believe that the dividends are growing, forecast the future growth rate (g). g = X Describe how you chose this number.

iv) What do you think the dividend will be for all of next year (D1)? D1 = X

v) Find the current stock price (P0) using Bloomberg, finance.yahoo.com, or google.com/finance P0 = X

vi) Using the information above calculate the cost of equity using the constant dividend model or the dividend growth model or state that neither one can be used. Cost of Equity = X

exhibit 2

9/6/2018	1
6/7/2018	1
3/8/2018	1
12/7/2017	0.97
9/7/2017	0.97
6/7/2017	0.97
3/8/2017	0.97
12/7/2016	0.92
9/7/2016	0.92
6/8/2016	0.92
3/2/2016	0.92