Homework5.docx - FIN 3331 Name Nguen Thi Ngoc Anh ID...

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FIN 3331 Name: Nguen Thi Ngoc Anh ID: 1540321 Intructor: Dr. Mike Whilock Date: 15 th April 15, 2020 Homework five 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 per share?
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 of return?

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