The following set-up pertains to the following 3 questions

The Company is expected to announce their annual dividend tomorrow. One year ago it paid a dividend of $2.20, and 4 years ago they paid $1.85. You believe that future dividend will grow by the same rate as past ones. The required rate of return on the stock is 16

18. What is the expected growth rate of the company?

a. 4.32 % b . 9.06 % c . 5.95 %d . 7.53 %

19. How much is your offer price?

a. 18.85

b. 28.83

C. 38.70

d. 23.53

20. Due to market conditions, you must purchase the stock for $8.00 above At this higher purchase price, what is your expected total rate of return?

a.15.18 %

b . 14.56 %

c. 12.83 %

d . 13.789 %