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Management action and stock value REH Corporation's most recent dividend was $2.82 per share, its expected annual rate of tividond growth is 5%; and the

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Management action and stock value REH Corporation's most recent dividend was $2.82 per share, its expected annual rate of tividond growth is 5%; and the regured retuin is now 15\%. A variety of proposals ace being considered by management fo tefirect the firm's activition. Determine the inpact on share price for tosch of itie folowiog peopesed sctions. a. Do noching. which will leave the key financlal variables unchanged h. Irrest in a new machine that we increase the dividend growth rate to tha and lower the repuired refurn to 14% c. Elminate an unprolitabie product lime, which wal inciease the didend grewth rate to 9% and rabe the required return to 17T d. Merge whith another firm, which will reduce the growh rate to 2 . and raite the reguired return to 17% e. Acquie a iutridiary operabon feom anothar manufactorer. The acquisition should increase the dividend growthrate to 9 s. and increase the required return to 17 . a. If the frm does nothing that will leave the hey finandal vaclakles unchanged, the value of the firat wie bes (Reund to the nearest cent)

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