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Question 1 (25 marks) Dino Incorporation just paid a dividend of S2 per share for its stocks issued. Given today's stock price is $60 each

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Question 1 (25 marks) Dino Incorporation just paid a dividend of S2 per share for its stocks issued. Given today's stock price is $60 each share and the market consent that dividend growth rate is 5% per year constantly in the foreseeable future, i what is the required return of the stock? ii. what is the expected stock price after 2 years? iii . what is the capital gain yield of the stock? b) If your required return on the stock is 10%, will you purchase the stock now? Explain your answer with calculation. c) Your friend, Peter, predicts that the stock will pay the following dividends over the next three years: $2, S5, and S4 per share. Afterwards, the dividend growth rate will be constant at 3% thereafter. If Peter's required retum is 10%, determine the stock value today for him. d) Your another friend, Joe, thinks that the company will adopt an odd dividend policy. He believes that the company will pay $2 dividend per share in every odd number of years (i.e. 1,3,5,7,9...), and $5 dividend per share in every even number of years (i.e. 2, 4, 6, 8, 10...); that is, the dividend pattern in the following years will be $2, S5, S2, S5, $2, $5... onwards. Using a more sophisticated financial modelling technique, based on a 10% required rate of return, both of you agreed that the stock price today should be $34.29 per share. However, due to the recent economic downturn arising from COVID-19, the senior management of the company intends to reduce the dividend payments by $1 per share every year indefinitely. Assume all your anticipation about the company's dividend payout pattern, and above estimated stock price ($34.29 per share) are correct, how much you are willing to pay per share today based on this new information of cutting the dividend payout

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