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Ventas, Inc. stock has paid cash dividends for the past 40 years and investors expect dividends to grow at about 4.5 percent in the future.

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Ventas, Inc. stock has paid cash dividends for the past 40 years and investors expect dividends to grow at about 4.5 percent in the future. The most recent dividend was $2.20 per share. Prior to the Fed's recent hike in interest rates, Ventas, Inc. stock was priced to provide a total return to investors of 10 percent. a) What was the price of the stock before the Fed action? (3 points) b) If the only effect of the Fed's action on UWC were an increase in the required rate of return on Ventas equity from 10 percent to 11 percent, would the stock price rise or fall? By how much? (4 points)

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