Integrative Risk and Valuation Hamlin Steel Company wishes to determine the value of Craft Foundry, a firm that it is considering acquiring for cash Hamlin wishes to determine the applicable discount rate to use as an input to the constant growth valuation model Craft's stock is not publicly traded After studying the required returns of firms similar to Craft that are publicly traded Hamin believes that an appropriate risk premium on Craft stock is about 9% The risk free rate is currently o% Cratrs dividend per share for each of the past 6 years is shown in the following table a. Given that Craft is expected to pay a dividend of $3 06 noxt year, determine the maximum cash price that Hamin should pay for each share of Craft (Hot Round the growth rate to the nearest whole porcont.) b. Describe the effect on the resulting value of Craft from (1) A decrease in its dividend growth rate of 2% from that exhibited over the 2014 2019 period 12) A decrease in its risk premium to 8% . The required return on Craft's stock is 5 (Round to the nearest whole percentage) Hamlin Steel Company wishes to determine the value of Craft Foundry, a firm that it is considering scount rate to use as an input to the constant-growth valuation model Craft's stock is not publicly aft that are publicly traded, Hamlin believes that an appropriate risk premium on Craft stock is abo are for each of the past 6 years is shown in the following table ? a dividend of $3.96 next year, determine the maximum cash price that Hamlin should pay for eac ent.) value of Craft from wth rate of 2% from that exhibited over the 2014-2019 period to 8% - X Data Table (Click on the icon here into a spreadsheet.) in order to copy the contents of the data table below Year 2019 2018 2017 2016 2015 2014 Dividend per Share $3 70 $3.46 S3.23 $3.02 $282 $2.64 Print Done Clear All