You expect XYZ stock to pay a $4.50 dividend at the end of the year. The stock price is expected to be $12 at that time. If you require a 15% rate of return, what would you pay for the stock now?

a. $14.35

b. $16.5

c. $19.41

d. $10.34

e. none

Terry wants to know the holding period return for a stock that he bought 9 months ago for $100 per share. The stock is now worth $109, and over the year, he received monthly dividends of $0.25 per share.

a. none of the items is correct

b, 9.19%

c. 12.00%

d. 9.00%

e. 11.20%