NOTE- parts 1-3 already answered below just need help with parts 4-9. Thank you!

Assume dividends, if any, are paid annually. Assume, unless otherwise noted, a discount rate (including the real interest rate, expected long run inflation plus a risk premium) of 11%.

I A company is expected to pay a dividend of 3/share forever. What is its stock price?

Dividend per year/rate of return = 3 / 0.11 = $27.27

II Instead, its dividends are expected to grow 4% (annually) forever. What is its stock price?

Price = dividend next year / (Required return - growth rate) = 3 /(11% - 4%) = 42.86

III What must be the expected growth rate for the company in II in order to have a stock price of 50 (the implied growth rate)?

50 = 3 / (11%-growth%) ; growth rate =11% - 3 / 50 = 5%

IV Suppose a company is expected to pay no dividends for three years, and then to pay 3/share forever. What is its stock price?

V A companys most recent dividend per share is 3. Its upcoming dividend is expected to increase by 10%, then increase by 10% each year thereafter for four years. At that time its dividend will remain fixed forever and ever. What is its price?

VI A companys book value per share is 50. Its ROE is 15%. It pays out 40% of earnings as dividends. Assume its retained earnings are expected to produce the same 15% ROE forever. What is its stock price?

VII The same company as in VII, except after five years it retains zero (and ROE continues at 15% forever). What is its stock price?

VIII What is the (percentage) effect of a 1% increase in interest rates rate on the stock prices in I, II & VII?

IX In VI, what if ROE is 10%? Any great investment idea here? (Hint: think buyout/liquidation)