The chairman of Heller Industries told a meeting of financial analysts that he expects the firms earnings and dividends to double over the next 6 years. The firms current (that is, as of year 0) earnings and dividends per share are $5 and $2.5, respectively. Use Table I and Table II to answer the questions.

1. Estimate the compound annual dividend growth rate over the 6-year period. Round FVIF value in intermediate calculation to three decimal places. Round your answer to the nearest whole number. % ________
2. Forecast Hellers earnings and dividends per share for each of the next 6 years, assuming that they grow at the rate determined in Part a. Use the growth rate rounded to the nearest whole percent. Round your answers to three decimal places.

   Year	Dividend	EPS
   1	$ fill in blank	$ fill in blank
   2	$ fill in blank	$ fill in blank
   3	$ fill in blank	$ fill in blank
   4	$ fill in blank	$ fill in blank
   5	$ fill in blank	$ fill in blank
   6	$ fill in blank	$ fill in blank

3. Based on the constant growth dividend valuation model, determine the current value of a share of Heller Industries common stock to an investor who requires an 18 percent rate of return. Do not round intermediate calculations. Round your answer to the nearest cent. $ ________
4. The stock price calculated in part c might not represent an accurate valuation to an investor with an 18 percent required rate of return because the growth rate will

• .
• Determine the current value of a share of Heller Industries common stock to an investor (with an 18 percent required rate of return) who plans to hold it for 6 years, assuming that earnings and dividends per share grow at the rate determined in part a for the next 6 years and then at 5 percent thereafter. Do not round intermediate calculations. Round your answer to the nearest cent. $ ________