Yankee Athletic Club has preferred stock with a par value of ?$100 and an annual 5?% cumulative dividend. Given the following prices for the preferred? stock, what is each investor seeking for his or her? return?

a.??Alex is willing to pay $40.

b.??Derek is willing to pay $30.

c.??Marcia is willing to pay $15.

d.??Johnny is willing to pay $10

Sia Dance Studios has an annual cash dividend policy that raises the dividend each year by 2?%.Last? year's dividend, Div 0Div0?, was $ 7 per share. The company will be in business for 60 years with no liquidating dividend. What is the price of this stock if

a.??an investor wants a return of 9?%?

b.??an investor wants a return of 11?%?

c.??an investor wants a return of12?%?

d.??an investor wants a return of 15?%?

e.??an investor wants a return of 16?%?

Miles Hardware has an annual cash dividend policy that raises the dividend each year by 14% Last? year's dividend, Div 0Div0?, was $ 2.00 per share. Investors want a return of 16?% on this stock. What is the? stock's price if

a.??the company will be in business for 10 years and not have a liquidating? dividend?

b.??the company will be in business for 15 years and not have a liquidating? dividend

c.??the company will be in business for 25 years and not have a liquidating? dividend?

d.??the company will be in business for 40 years and not have a liquidating? dividend?

e.??the company will be in business for 70 years and not have a liquidating? dividend?

f.???the company will be in business? forever?

Seitz Glassware is trying to determine its growth rate for an annual cash dividend. The most recent? dividend,

Div 0Div0?,was $ 0.30 per share. The? stock's target return rate is 12?%. What is the? stock's price if

a.??the annual growth rate is 3?%?

b.??the annual growth rate is 4?%?

c.??the annual growth rate is 6?%?

d.??the annual growth rate is 8?%?

e.??the annual growth rate is 11?%?

?Staton-Smith Software is a new? start-up company and will not pay dividends for the first five years of operation. It will then institute an annual cash dividend policy of $2.75 with a constant growth rate of 6?%, with the first dividend at the end of year six. The company will be in business for 25 years total. What is the? stock's price if an investor wants

a.??a return of 11?%?

b.??a return of 15?%?

c.??a return of 25?%?

d.??a return of 35?%?

Pfender Guitars has a current annual cash dividend policy of $7.00 The price of the stock is set to yield a return of

9?%.What is the price of this stock if the dividend will be paid

a.??for 9 years and then the comapny repurchases the stock for $25??

b.??for 11 years and then the comapny repurchases the stock for $25?

c.??for 50 years and then the comapny repurchases the stock for ?$25??

d.??for 60 years and then the comapny repurchases the stock for ?$25?

e.??for 100years and then the comapny repurchases the stock for $25?

f.???forever with no repurchase of the? stock?

Singing Fish Fine Foods has a current annual cash dividend policy of

?$4.004.00.

The price of the stock is set to yield a return of

12 %12%.

What is the price of this stock if the dividend will be paid

a.??for 12 years?

b.??for 16 ?years?

c .for 41 years?

d.??for 50 years?

e.??for 100 years?

f.???forever?

Singing Fish Fine Foods has a current annual cash dividend policy of $4.00 The price of the stock is set to yield a return of 14% What is the price of this stock if the dividend will be paid

a.??for 10 years?

b.??for 16 years?

c.??for 42 years?

d.??for 60 years?

e.??for100 years?

f.???forever?

King Waterbeds has an annual cash dividend policy that raises the dividend each year by 5?%.The most recent? dividend,Div 0Div0?,was $ 0.40 per share. What is the? stock's price if

a.??an investor wants a return of 7?%?

b.??an investor wants a return of 8?%?

c.??an investor wants a return of 11?%?

d.??an investor wants a return of 15?%?

e.??an investor wants a return of 18?%?

Dietterich Electronics wants its shareholders to earn a return of 7% on their investment in the company. At what price would the stock need to be priced today if Dietterich Electronics had a

a.??$0.30 constant annual dividend? forever?

b.??$0.80 constant annual dividend? forever?

c.??$1.801.80 constant annual dividend? forever?

d.??$3.50 constant annual dividend? forever?

Find the average annual growth rate of the dividends for each firm listed in the following table.

Dividend Payment per Year

What is the average annual growth rate of the dividends paid by? Loewen? Morse? Huddleston? Meyer?

Firm

2006

2007

2008

2009

2010

2011

				+
				+

Loewen

?$1.04

?$1.07

?$1.20

?$1.21

?$1.26

?$1.32

Morse

?$1.12

?$0.80

?$0.90

?$1.30

?$1.20

?$1.40

Huddleston

?$1.75

?$2.00

?$3.50

?$3.80

?$4.00

?$5.25

Meyer

?$2.00

?$2.50

?$2.00

?$2.72

?$2.85

?$2.90