Company Z's earnings and dividends per share are expected to grow indefinitely by 5 per cent a year. If next year's dividend is pound 10 and the expected return is 8 percent, what is the current stock price? Company W is like Z in all respects except one: its growth will stop after year 4, i.e., in year 5 and afterward, it will pay out all earnings as dividends. What is W's stock price? Assume next year EPS (earnings per share) is pound 15. As winner of an annual garden competition, you can choose one of the following prizes: pound 100,000 now pound 180,000 at the end of five years pound 11, 400 a year forever pound 19,000 for each of ten years pound 6, 500 next year and increasing thereafter by 5 percent a year forever. If the interest rate is 12 percent, which is the most valuable prize? Mr Baker is planning for his retirement. He is planning to work for 100 years (from now) He plans to live forever after he retires, and would like to have an annual payment of pound 100,000, starting 100 years from now (when he retires). How much will Mr Baker have to deposit in the bank today to fund these payments? Assume that the interest rate paid by the bank is 3%, and that the interest rate will remain constant forever. The bank has no chance of failing