Assume that a stocks current a P/E ratio is 25 (earning here is the earning next year) and it has an expected dividend yield of 1.5 percent next year

. a) Suppose the dividend will grow at rate 6.5 percent, estimate the required rate of return of the stock.

b) Estimate the required rate of return for the stock if its dividend grows at rates of 5, 6, and 7 percent.

c) Suppose the stocks payout rate is still the same and the required rate of return becomes 11 percent. What P/E should the stock have if the growth rate of dividends is 5, 6, and 7 percent? (Do a separate calculation for each growth rate.)

d) Suppose the required rate of return is 8 percent and the payout rate is still the same. What P/E should the stock have if the growth rate of dividends is 5, 6, and 7 percent? (Do a separate calculation for each growth rate.)