Exercise 5: a. Company Y does not plow back any earnings and is expected to produce a level dividend stream of $7.0 a share. If the current stock price is $42.0, what is the cost of equity? b. Company Z's earnings and dividends per share are expected to grow indefinitely by 4% a year. If next year's dividend is $10 and the cost of equity is 14%, what is the current stock price? c. Company X is expected to pay an end-of-year dividend of $5 a share. After the dividend, its stock is expected to sell at $110. If the cost of equity is 8%, what is the current stock price?