Which of the statements below is FALSE? O 1) Lack of a dividend pattern is not a problem for the dividend models to work. A firm's dividend in 2008 was less than its dividend in 2003. This means that the estimated growth rate is negative, and this produces a negative expected return. 3. Shortcomings of the dividend pricing models suggest that we need a pricing model that is more inclusive and that can estimate expected returns for stocks without the need for a stable dividend history. 4) The dividend models (growth or constant dividend) appeal to a fundamental concept of financial assets, that is, the value of the financial asset is determined by the future cash flow the owner is entitled to while holding the asset. You want to invest in a stock that pays $6.00 annual cash dividends for the next five years. At the end of the five years, you will sell the stock for $30.00. If you want to earn 10% on this investment, what is a fair price for this stock if you buy it today? 1) 41.37 O 2) 22.75 3) 18.63 4) 40.37 Question 3 (5 points) MiCasa Inc. is going to offer to its members preferred stock with a par value of $60.00 and an annual dividend rate of 5%. If a member wants a 10% return, what price should he or she be willing to pay? Do not use the sign. Use commas to separate thousands. Round to two decimals. For example if you obtain $1,432.728 then enter 1,433.73 or if you obtain $1.120.1321 then enter 1,120.13. Your Answer: Answer Queen B Corp. has a current annual cash dividend policy of $5.00. The price of the stock is set to yield 11% return. What is the price of this stock today if the dividend will be paid for 7 year and then a liquidating final dividend of $30.00? Show your answer to the nearest 2 decimals. Do not use the $ sign in your answer. For example, if the answer is $3.237 enter your answer as 3.24 Do not enter it as $3.237, $3.2, 3.2, or 3.237 Your