Assuming that the constant growth rate dividend discount model can be applied, work out the rate at which the dividends of the following firms are expected to grow:(4 points each for a total of 12 points)

(a).XYZ Inc. pays out 20% of its earnings as dividends, has a forward-looking P/R ratio [current price to next twelve months revenues] of 3.2, a profit margin of 20%, and a market capitalization rate of 15% per year, and

(b).PQR Inc. generates 25 cents on every dollar of the book value of equity, has a price to book ratio of 2, and a market capitalization rate of 20% per year.(

c).ABC Corp. has a profit margin (earnings over revenues) of 15%, Asset Turnover of 1.8 (ratio of the book value of the Assets at t=0 to the revenues between t=0 and t=1), leverage of 1.5 (ratio of the book value of assets to the book value of equity), and a retention ratio of 16%.