You want to invest in a stock that pays an annual dividend of $5 each year for the next five years. At

the end of the five years, you expect to sell the stock for $25.00. If the required rate of return on this

stock is 9%, what should be the fair value of this stock today?

Swan Lake Marina is expected to pay an annual dividend of $1.58 next year. The stock is selling for

$18.53 a share and its required return is 12 percent. Assuming its dividends will grow at a constant

rate, what is the dividend growth rate of this company?

You have been assigned to value Cosmos Inc., which has just paid a dividend of $0.70. You

estimate that its required return on equity is 11%. You expect Cosmos Inc. to grow rapidly for the

next 3 years, and estimate that its dividends will grow at 12% during this period. After 3 years, you expect the company to reach maturity and its dividends grow at a constant rate of 7% forever. How much is the Cosmos stock worth today?

IBM has just paid a dividend of $3. The initial dividend growth rate is 20%, and you expect it to

decline linearly over a10-year period to a final and perpetual growth rate of 6%. If the required

return on IBMs equity is 10%, the value of its stock using the H model is:

Fenix International is a mature company with a stable return on equity equal to 20%. Its dividend

payout ratio is 70%, and earnings retention rate is 30%. What is the long term sustainable growth

rate of Fenix International?