QUESTION 42 A firms common stock currently sells for $40 per share. The firms most recent dividend paid (D0) is $2 per share on its common stock, and investors expect the dividend to grow indefinitely at a constant rate of 10% per year. Whats the firms cost of common stock using DCF approach? 9.5% 15.0% 15.5% 16.5%

QUESTION 43 A stock is selling for $50 in the market. The companys beta is 1.2, the market risk premium (rM - rF) is 5%, and the risk-free rate is 6%. The most recent dividend paid is D0 = $2.0 and dividends are expected to grow at a constant rate g. Whats the required rate of return by common shareholders? 5.0% 6.0% 11.0% 12.0%

QUESTION 44 Based on the information from Question 43, whats the dividend growth rate g? 6.22% 7.31% 7.69% 8.15%

QUESTION 45 Based on the information from Question 43 and 44, calculate the stocks expected dividend yield. 4.31% 5.00% 6.22% 7.70%