Question: 9. Boilermaker Inc. just announced that it will increase the annual dividend to $1.75 in the next year and establish a policy whereby the dividend

 9. Boilermaker Inc. just announced that it will increase the annual

9. Boilermaker Inc. just announced that it will increase the annual dividend to $1.75 in the next year and establish a policy whereby the dividend will increase by 2 percent annually thereafter. How much will one share of this stock be worth six years from now if the required rate of return is 14.5 percent? A. $14.00 B. $14.28 C. $14.84 D. $15.77 E. $16.08 10. Pluto Corporation just paid a $1.80 per share annual dividend last month. The company is planning on paying $2.00, $2.50, $2.75, and $3.00 a share over the next four years, respectively. After that the dividend will be constant at $3.20 per share per year. What is the market price of this stock if the market rate of return is 13 percent? A. $7.47 B. $15.96 C. $20.73 D. $22.57 E. $24.37

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