a)

b)

Let's say Omega Records dividend payment will be $1.29 one year from now, $2.25 two years from now, and $3.15 three years from now. Further assume that after this the dividend will grow by 3.45% each year. The required rate of return for the industry is 8.87%. What is the value of Omega Records stock? What is the payback period (in annual terms) of the following cashflow stream? Year 1: $-986 Year 4: $362 Year 9: $901 Year 13: $-42 Year 15: $808 Year 19: $-951 W