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Firm A just paid $2.50 per share and the current stock price is $36.00.... 1. Firm A just paid $2.5 per share, and the current

Firm A just paid $2.50 per share and the current stock price is $36.00.... image text in transcribed

1. Firm A just paid $2.5 per share, and the current stock price on the market is $36.00. The beta of this stock is 1.2, and the risk-free rate is 2%. and the market return is 10%. You expect that the long term growth rate of this dividend would be 4%. What is the value of this stock? 2. From Bloomberg, you got the following information. The annual dividends of Stock B are forecasted by analysts to be $3.00. $3.10, $3.25. $3.50 and $3.85. In addition, the stock price is expected to be $50.00 in five vears. If the required return on equity using CAPM is 10% what is the value of this stock? 3. Company Crecently paid a $4 dividend. The expected short-term growth rate is 10%, and you expect the rate to fall to a stable growth rate, long-term growth rate, of 3% over the next ten years. If the required rate of return is 9 %, what would the value of a share in the company C be under the H-model? 4. The firm D pays a current dividend of $2.00 Growth rate is 25% for the next three years growth then declines linearly over eight years to a stable rate of 6%. The required return on this stock is 10% and the current stock price of firm D is $50. Calculate the value using an appropriate model

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