Question: 26. [CH 7] Kellerman has $75 par value preferred stock. It pays a dividend of $1.25 and the required rate of return is 7.5%. What

26. [CH 7] Kellerman has $75 par value preferred stock. It pays a dividend of $1.25 and the required rate of return is 7.5%. What is the value of this stock today? $16.67 27. [CH 7] All-Star Imports just paid a dividend of $1.25. Their growth rate in dividends is 10% and you require a rate of return of 10%, what is the value of this stock today? Cannot use Constant Growth Dividend Model. g > R. Must use another valuation model. 28. [CH 7] You require a 12% return on your investments. Southern Sweets will pay a $2.50 dividend next year. Dividends are projected to grow at 3% per year, indefinitely. What is the price of a share of Southern Sweets? S27.78

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