IBM currently pays $5.60 as its annual dividend as DI (the dividend next year). Dividends are anticipated to grow at a 2% annual rate forever. If the required return on IBM is 5.5%, what is the share price of IBM stock Using the Dividend Growth Model? a. $130.00 b. $160.00 $173.33 d. $143.22 The next dividend payment by Mosby, Inc. will be $2.45 per share. The dividends are anticipated to maintain a 5.5 percent growth rate, forever. If the stock currently sells for $48.50 per share, what is the required return? a. 11.38% b. 5.05% c. 5.50% d. 10.55% What is the net present value of a project with the following cash flows if the discount rate is 8 percent? a. $1, 085.25 b. $2, 706.20 c. $1, 193.77 d. $3, 498.28 You are considering an investment for which you require a 10 percent rate of return. The investment will cost $56, 000 and produce cash inflows of $10, 000 a year for eight years. Should you accept this project based on its internal rate of return? Why or why not? a. yes; because the IRR is 14.08%, which is better than 10% b. yes; because the IRR is 11.81%, which is better than 10% C. yes; because the IRR is 10.71%, which is better than 10% d. no; because the IRR it 8.69% which it less than 10% Which is NOT correct? a. Select project with IRR 1. C. Select projects with payback period 0. The net present value: a. increases as the required rate of return increases. b. is another name for the internal rate of return. c. it a method of analysis that cannot be applied to mutually exclusive projects. d. decreases at the required rate of return increases