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An investor with a required return of 1 4 percent for very risky investments in common stock has analyzed three firms and must decide which,

An investor with a required return of 14 percent for very risky investments in common stock has analyzed three firms and must decide which, if any, to purchase. The information is as follows:
\table[[Firm,A,B,C,],[Current earnings,$2.30,$3.20,$6.60,],[Current dividend,$1.00,$3.40,$6.90,],[Expected annual growth rate in,5%,3%,-2%,],[dividends and earnings,,,,],[Current market price,$14,$35,$50,]]
a. What is the maximum price that the investor should pay for each stock based on the dividend-growth model? Round your answers to the nearest cent.
Stock A:$
Stock 8:$
Stock C: $
b. If the investor does buy stock A, what is the implied percentage return? Round your answer to two decimal places.
%
c. If the appropriate P/E ratio is 14, what is the maximum price the investor should pay for each stock? Round your answers to the nearest cent.
Stock A:$
Stock B: $
Stock C: $
If the appropriate P/E ratio is 5, what is the maximum price the investor should pay for each stock? Round your answers to the nearest cent.
Stock A: $
Stock B: $
Stock C:$
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