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##### 1.Suppose the required rate of return on stock is...

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1.Suppose the required rate of return on stock is 11% and the growth rate is 5%. If the current price of stock is \$20, then what is the value of D1 (next period's dividend)? 2.Suppose the required rate of return on stock is 7.5% and the growth rate is 4.5%. If the current price of stock is \$80, then what is the value of Do? 3.Suppose the current price of stock is \$25. What is the growth rate if next period's dividend is \$2 and the required rate of return on stock is 12%? 4.Suppose the current price of stock is \$72. What is the growth rate if current period's dividend (Do) is \$3 and the required rate of return on stock is 9.375%? 1.Suppose that dividends are growing at 3%. If today's dividend is \$2.5 and the required rate of return is 8%, determine Po, P5, P8 2.Suppose that dividends are growing at 4%. If next period's dividend is \$1.2 and the required rate of return is 10%, determine Po, P4, P6

Paper#8652 | Written in 18-Jul-2015

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