EXCEL ONLY

ALL SUBMISSIONS SHOULD BE IN EXCEL WORKSHEET Problem 1: A share of common stock has an expected long-run constant dividend growth rate of 6%, and the most recent dividend Do, was $5.00. The required rate of return on the stock is 14%. Calculate the current price of the stock using the constant dividend growth model. Problem 2: Given the following information, calculate the price of the common stock using constant dividend growth model. Risk-free rate (RI) = 4%; Market Rate of Return (R) =12% Beta of the Stock = 1.25 Expected end of the year Dividend = $2.00/per share Constant dividend growth rate = 6% per year [Hint: First calculate the required rate of return for the stock using CAPM] Problem 3: A firm can grow at a high rate of 15% for the next 5-years; and hence its dividends. It has an expected long-run constant dividend growth rate of 7%, and the most recent dividend Do, was $5.00. The required rate of return on the stock is 20%. Calculate the current price of the stock using "two-stage dividend growth model