5. Variable growth: new product should enable 12% growth for two years, then 8% for two years, thereafter competition will force the firm back to its competitive 3% growth What is the price of this stock? mes New Ro... 12 BI U AY... investment. EQUITY VALUATION Based on expected cash flow as represented with div V = D/k or V=D1/(k-g) or V = S [Dn/(1+k)"] + [Dn+1/(k-g)]/(1+k) Given rrr = 12% 3. No growth: dividend has been and expected to remain $2 per year What is the price of this stock? $16.67 4. Growth: recent $2 dividend is expected to grow by 6% (representing firm growth) into the future What is the price of this stock? $35.33 5. Variable growth: new product should enable 12% growth for two years, tt for two years, thereafter competition will force the firm back to its compet 3% growth What is the price of this stock? MORTGAGE 6. Given these details, $350,000 home price, a 30-year mortgage with 10% do 4.0% fixed rate, what is the monthly Payment expected on this mortgage? $2,333| $ 7. Given these details, $110,000 annual salary, a monthly car payment $328 an student loan payment of $230, calculate the maximum monthly payment app without the need of sending the application to a committee for deliberation IF 20