You are trying to value Mcdonald's stock using the dividend discount model. You have the following accounting information from Mcdonald's annual report (10-K) and LTM (Last Trailing Month) a) As reported on Mcdonald's annual report (December 31, 2015), Mcdonald paid an annual dividend of $3.44 per share. What will be annual dividend per share one year from now if you use dividend discount model to value Mcdonald's share price? b) You assume that Mcdonald's growth rate will converge to its industry median growth rate (2.04\%). After the fifth year, the growth will stay at 2.04% thereafter. What will be the value of a share of Mcdonald stock according to dividend-discount model? - Beta for Mcdonald is 0.49 - Risk-free rate is 2.22% and market risk premium is 6%. c) Currently, Mcdonald stock is traded at $127.38, would you recommend to sell or buy the stock? Why