7.

5. Variable growth: new product should enable 12% growth for two years, then for two years, thereafter competition will force the firm back to its competitive 3% growth What is the price of this stock? MORTGAGE 6. Given these details, $350,000 home price, a 30-year mortgage with 10% down at 4.0% fixed rate, what is the monthly Paymant expected on this mortgage? 7. Given these details, $110,000 annual salary, a monthly car payment $328 and a student loan payment of $230, calculate the maximum monthly payment approved without ther need of sending the application to a committee for deliberation IF the rule used is 30%, and would you receive likely approval for a mortgage with a $2,800 monthly payment with no bad entries on your credit report given the 30% rule?? investment EQUITY VALUATION Based on expected cash flow as represented with dividends: V=D/k or V=D//(kg) or V = S(/(1+k)"] + [Dn+1/(k-g)/(1+k) Given - 12% 3. No growth: dividend has been and expected to remain $2 per year What is the price of this stock? $16.67 O 4. Growth: recent S2 dividend is expected to grow by 6% (representing firm's 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, then 8% for two years, thereafter competition will force the firm back to its competitive 3% growth What is the price of this stock? MORTGAGE 6. Given these details, $350,000 home price, a 30-year mortgage with 10% down at 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 and a student loan payment of $230, calculate the maximum monthly payment approved without the need of sending the application to a committee for deliberation IF the rule used is 30%, and would you receive likely approval for a mortgage with a $2,800 monthly payment with no bad entries on your credit report given the 30% rule?? You will not receive likely approval for a mortgage with a 2.800 monthly payment with no bad entries on your credit report given the 30% Rule