Q3

Q4

Common stock value - Variable growth Lawrence Industries' most recent annual dividend was $2.27 per share (D0=$2.27), and the firm's required return is 14%. Find the market value of Lawrence's shares when dividends are expected to grow at 10% annually for 3 years, followed by a 6% constant annual growth rate in years 4 to infinity. The market value of Lawrence's shares is $ (Round to the nearest cent.) Common stock value - Variable growth Newman Manufacturing is considering a cash purchase of the stock of Grips Tool. During the year just completed, Grips earned $3.87 per share and paid cash dividends of $2.17 per share (D0=$2.17). Grips' eamings and dividends are expected to grow at 20% per year for the next 3 years, after which they are expected to grow 8% per year to infinity. What is the maximum price per share that Newman should pay for Grips if it has a required return of 11% on investments with risk characteristics similar to those of Grips? The maximum price per share that Newman should pay for Grips is $ (Round to the nearest cent.)