Q$1$

A share of stock has a dividend that is expected to grow at a constant perpetual rate.

During the next year $($t$=0$ to t$=1),$ the dividend yield is expected to be $6\mathrm{.}1\%.$

Dividends are paid at year$$s end.

If the dividend paid at the end of the year $($at t$=1)$ is expected to be $$7\mathrm{.}51,$ what is a fair price for the stock today?

$($Answer to the nearest $$0\mathrm{.}01)$

$???$

Q$2$

You are investing in a share of stock. The share just paid a dividend of $$3\mathrm{.}62.$ The dividend has been growing and is expected to grow forever at a rate of $5\mathrm{.}58\%$ per year. You require a $13\mathrm{.}79\%$ rate of return on the stock investment. What would be a fair price$/$share in $6$ years?

$($Answer to nearest $$0\mathrm{.}01)$

$???$

Q$3$

You are investing in a share of stock. The share will pay a dividend of $$7\mathrm{.}95$ at the end of the first year. The dividend is expected to grow forever at a rate of $2\mathrm{.}4\%$ per year. You require a $8\mathrm{.}76\%$ rate of return on the stock investment. What is a fair price $($or$,$ value$)$ for this share of stock?

$($Answer to nearest $$0\mathrm{.}01)$

$???$

Q$4$

You have the following data regarding a share of stock in a particular firm:

The dividend at the end of the current year is expected to be $$2\mathrm{.}33/$share

The dividend is expected to grow at a constant rate forever

The dividend growth rate is $0\mathrm{.}11\%$

Investors in the stock expect a $24\mathrm{.}24\%$ total return from investing in the stock

What will be the capital gains yield for the second year $($t$=1$ to t$=2)?$

$($Answer to the nearest $0\mathrm{.}01\%)$

$???$

Q$5$

A share of preferred stock pays a $$2\mathrm{.}08$ quarterly dividend. If investors require a $14\mathrm{.}59\%$ rate of return, what is a fair price for each share?

$($Answer to the nearest $$0\mathrm{.}01)$

$????$