LMN Limited issued new preferred shares that will start pay a $1.25 annual dividend per share beginning in 4 years from now (or at the end of year 3).

1) If the current market required return is 7.95 percent what should be the share price 4 years from now?

a)17.59

b)15.12

c)16.25

d)15.75

e) 14.46

2) If the current market required return is 7.95 percent what would be the present share price?

a) 11.72

b)12.95

c)10.86

d)11.90

e)11.58

3)If the current market required return is 10 percent what should be the share price 4 years from now?

a. 12.10

b.13.00

c.12.78

d.11.98

e.12.50

4)If the current market required return is 10 percent what would be the present share price?

a. 6.75

b.9.21

c.9.98

d.7.95

e.8.54