1. The MGC Company just paid $6 dividend per share and it expects for each of the next four years a high annual growth of 60%. Thereafter it will continue growing at the constant long-run rate of 5% annually.

What's your prediction for the stock price in four years from now assuming a required annual return of 15%?

a.412.88

b.398.73

c.501.33

d.489.22

2. What should be the present price of the MGC stock?

a.238.33

b.327.29

c.292.83

d.306.99

3. The CGY for the first years, of the above stock, is expected to be

a.10.023%

b.3.430%

c.13.237%

d.11.722%