a. If you can earn 13% on similar-risk investments, what is the most you would be willing to pay per share in 2022, just after the $2.87 dividend? b. If you can earn only 10% on similar-risk investments, what is the most you would be willing to pay per share? c. Compare and contrast your findings in parts a and b, and discuss the impact of the discount rate (and therefore, risk) on share value. LG4 P7-14 Common stock value: Variable growth Newman Manufacturing is considering a cash purchase of the stock of Grips Tool. During the year just completed, Grips earned $4.25 per share and paid cash dividends of $2.55 per share (Do = 2.55). Grips earnings and dividends are expected to grow at 25% per year for the next three years, after which they are expected to grow at 10% per year forever. What is the maximum price per share that Newman should pay for Grips if it has a required return of 15% on investments with risk characteristics similar to those of Grips? Personal Finance Problem LG4 P7-15 Common stock value: Variable growth Home Place Hotels Inc. is entering into a three- year remodeling and expansion project. The construction will have a limiting effect on earnings during that time, but when completed, it should allow the company to enjoy much improved growth in earnings and dividends. Last year, the company paid a dividend of $3.40. It expects zero growth in the next year. In years two and three, 5% growth is expected, and in year four, 15% growth. In year five and thereafter, growth should be a constant 5% maximum price per share th