Nguen Thi Ngoc Anh
Dr. Mike Whilock
April 15, 2020
Problem 9.1: Warr Corporation just paid a dividend of $1.50 a share (that is, D0=$150).
The dividend is expected to grow 7% a year for the next 3 years and then at 5% a year
thereafter. What is the expected dividend per share for each of the next 5 years?
Problem 9.2: Thomas Brothers is expected to pay a $0.50 per share dividend at the end of
the year (that is, D1=$0.50). The dividend is expected to grow at a constant rate of 7% a
year. The required rate of return on the stock, rs, is 15%. What is the stock’s current value
Problem 9.3: Harrison Clothiers’ stock currently sells for $2000 a share. It just paid a
dividend of $100 a share (that is, D0 = $100). The dividend is expected to grow at a constant
rate of 6% a year. What stock price is expected 1 year from now? What is the required rate