Business Finance FIN 3200 ASSIGNMENT #3 Show all work including time lines for full credit] 1. Company X is expected to pay an year-end dividend of $5 a share on its common stock. After the dividend payment the stock is expected to sell at $110 per share. The required rate of return on the common stock is 15%. Then, calculate the current price of t Also calculate the dividend yield and capital gains yield for the stock. 2, A share of common stock has an expected long-run constant dividend growth rate of 7%, and the most recent dividend Do, was $5.00. The required rate of return on the common stock is 18%. Then, using the dividend growth model, calculate the current price of the stock. A share of common stock has an expected long-run constant dividend growth rate of 6%, and the most recent dividend Do, was $5.00. The stock is currently selling for $50 per share Calculate the required rate of return on the stock. Also calculate the dividend yield and capital gains yield for the stock 4 If the dividends on a preferred stock is $9 per year, and the required rate of return on the stock is 12%, then calculate the current price of the preferred stock. 5. For Stock A, the cash dividend expected one year from now is $9 [Di]. The dividends are expected to grow at a constant rate of 6% per year for ever. The required rate of return on the common stock is 15%. Then calculate the current price of the stock using the dividend growth model. A stock is currently selling for $50/share. The most recent dividend was $2.50/ share. If the firm maintains a constant growth rate for ever at 8%; (a) calculate the required rate of return for the stock. (b) calculate the dividend yield and capital gains yield for the stock 6