$6.$ Suppose that Coca$-$Cola Co$.$ is expected to pay a $$1\mathrm{.}76$ dividend in one year. If you expect

Coca Cola's dividend to grow by $4\mathrm{.}5\%$ per year forever, and Coca Cola's equity cost of capital is

$10\mathrm{.}5\%,$ then the value of a share of Coca Cola stock is closest to:

a$)$ $$19\mathrm{.}33$

b$)$ $$29\mathrm{.}33$

c$)$ $$16\mathrm{.}76$

d$)$ $$16\mathrm{.}72$ :

e$)$ None of the above is correct, instead it should be

$7.$ Now suppose that you expect Coca$-$Cola's dividend to grow by $5\mathrm{.}25\%$ per year forever

$($instead of $4\mathrm{.}5\%).$ All other assumptions are the same as in MCQ $6$ above. The percentage

change in the value of a share of Coca$-$Cola stock, as compared to your answer in MCQ $6,$ is

closest to:

a$)-14\mathrm{.}29\%$

b$)-12\mathrm{.}50\%$

c$)12\mathrm{.}50\%$

d$)14\mathrm{.}29\%.$

e$)$ None of the above is correct, instead it should be

$($I need the step by step answer only to question $7)$