QUESTION 1

Trust Bankers just paid an annual dividend of $1.7 per share. The expected dividend growth rate is 5.7 percent, the discount rate is 11 percent, and the dividends will last for 7 more years. What is the value of the stock?

QUESTION 2

A share of stock will pay a dividend of $1.7 one year from now, with dividend growth of 4.2 percent thereafter. According to the constant dividend growth model, if the required return is 14.1 percent, what should the value of the stock be 4 years from now?

QUESTION 3

A share of stock just paid a dividend of $1.4, with an expected dividend growth of 5.6 percent forever. According to the constant perpetual growth model, if the required return is 14.8 percent, what should the value of the stock be 3 years from now?

QUESTION 5

The dividend for Weaver, Inc., is expected to grow at 15 percent for the next 4 years before leveling off at a 5.4 percent rate indefinitely. If the firm just paid a dividend of $1.09 and you require a return of 11 percent on the stock, what is the most you should pay per share?