Question: 13a- Use the Dividend Growth Model to compute the expected price of a stock in 4 years. Each share is expected to pay a dividend

13a- Use the Dividend Growth Model to compute the expected price of a stock in 4 years. Each share is expected to pay a dividend of $9.85 in one year. Investors' annual required rate of return is 10.1%, and the expected growth rate of the dividend is 5.1% per annum. Answer to the nearest penny.

Answer:

13b- Jane purchased 100 shares of Acme Consolidated 1 year ago at $67.04 per share. During the year, Acme paid a dividend of $2.82 per share. Currently, the stock is selling for $78.44 per share. What is Jane's realized rate of return for the year from the stock? Answer as a percentage, 2 decimal places (e.g., 12.34% as 12.34).

Answer:

13c- JFG stock is expected to pay a dividend of $5.78 a share in one year. Thereafter, the expected annual growth rate of the dividend is 3.9%. Based on the Dividend Growth model, what is the most that you would be willing to pay for a share of JFG stock today if your required rate of return is 11.7% per annum? Answer to the nearest penny.

Answer:

current price of stock is not given!

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