A firm's dividend history is as follows. Calculate the Dividend Growth Rate and the expected dividend for next year if the current dividend is $2.00.

Dividends:

• Year 1: $1.50
• Year 2: $1.60
• Year 3: $1.70
• Year 4: $1.85

Requirements:

1. Calculate the historical Dividend Growth Rate.
2. Predict the dividend for next year using the Dividend Growth Rate.
3. Explain the significance of the Dividend Growth Rate in stock valuation.
4. Calculate the expected dividend yield if the current stock price is $25.