Quantitative Problem 1: Hubbard Industries just paid a common dividend. De of $1.70. It expects to grow at a constant rate of 3% per year. If investors require 115. return on equity, what is the current price of Hubbard's common stock? Do not round intermediate calculations. Round your answer to the nearest cent. $ Zero Growth Stocks The constant growth model is sufficiently general to handle the case of a cero growth stock, where the dividend is expected to remain constant over time. In this situation, the equation is: Note that this is the same equation developed in Chapter 5 to value a perpetuity, and it is the same equation used to vale a perpetual preferred stock that entities its owners to regular fixed dividend payments in perpetuity. The valuation equation is simply the current dividend divided by the required rate of return Quantitative Problem 2: Carlyste Corporation has perpetual preferred stock outstanding that pays o constant annual dividend of 51.60 at the end of each year. If Investors require an 6% return on the preferred stock, what is the price of the firm's perpetual preferred stock? Round your answer to the nearest cent. 5 per share Nonconstant Growth Stock For many companies, it is not appropriate to assume that dividends will grow at a constant rate. Most firms go through life cycles where they experience different orowth rates during different parts of the code. For valuing these firms, the generalized valuation and the constant growth equations are combined to anive at the nonconstant growth valuation equations D De D + ++ + growth rates ouring ofterent parts of the caror Varung media, the power nonconstant growth valuation equation Di Du + + + (1) Basically, this equation calculates the present value of dividends received during the nonconstant growth period and the present value of the stock's horizon value which is the value at the horizon date of all dividends expected thereafter Quantitative Problem 3: Assume today is December 31, 2019. Imagine Works Inc. Sunt paid a dividend of 51.40 per share at the end of 2019. The dividend is expected to grow at 18% per year for years, after which time it is expected to grow at a constant rate of 5.5 annually. The company's cost of equity () is 9.5% Using the dividend growth model Callowing for nonconstant growth), what should be the price of the company's stock today (December 31, 2019)? Do not round, Intermediate calculations. Round your answer to the nearest cont. per share