Please circle the letter against the best answer Use the following to answer question 1 to 5 An investor is looking for ways to value a company and program and has just completed the course in Investment and Portfolio management. During the went to a friend called Tommy who is in the EMBA iscourse, Tommy told his friend that you can use the dividend discount model to value companies and that t here are three scenarios that can be looked at. The investor wanted to know more so he supplied the following information to Tommy to do the valuation for an information technology company he is looking at. Recently paid dividend GHO 80; market risk premium : 5%; risk free rate-12% and the betas 1.25. 1- what is the price per share of this company if dividend is expected to grow at 8% forever? a. GHC9.24 b. GHC7.80 C. GHC8.43 d. GHC6.28 2. If dividend is expected to grow at 12% for the first two years and fall to 6% thereafter, what is the share price? a. GHC9.13 b. c. GHC7.48 d. GHC8.37 GHC6.25 Assuming that the market is selling the shares of this company at GHC9.40 and dividend is growing at 10% forever, what is the implied required rate of return? 19.36% 20.52% 18.51% 16.84% 3. a. b. C. d. Assuming that the company will start paying dividend of GHCO.80 in 4 years' time and that dividend will grow after that by 10% every year forever, what is the price per share? 4. a. GH(6.25 b. GHO5.87 C. GH04.40 d. GHC7.16 If this company issued preference shares and the first payment of GHc0.90 will be in a years' time, what is the price per preference share if the required rate of return for preference shareholders is estimated using the 91-Treasury Bill rate of 15% plus a premium of 200 basis points? 5. a. GHC4.93 b. GHC6.25 c. GHCS.29 d. GHC7.54