QUESTION 15 10 Find the value of the Stock with non-constant growth Again Consider the publicly traded firm Gemma Corp. Their last dividend paid was $7.7. The growth rate is expected to be 6% for the next two years and then 2% forever after that. The firm's required return is 12%. What is the best estimate of the current stock price? Do not round intermediate calculations. And include two decimals in your answer QUESTION 16 10 Can you find the value of Preferred Stock? Raya Inc, pays a dividend of $8.52 per year. It is required return was 13.51%, what would the preferred stock's value be? For preferred stock, use the dividend or expected dividend (the dividends do not grow in our preferred stock examples and divide by the required rate of return . The required rate of return on preferred stock is different than common stock even within the same fimm because there are different risks involved in each type of holding - this is important in Chapter 10 Preferred stock is like a hybrid between common stock and debt The output of the preferred stock equation gives as estiamte in dollars of the value to the stock In chapter 10, we will flip this equation around and solve for (1) QUESTION 17