If the required return on equity is 12%, find the value of a stock that is expected to pay a $1.50 dividend at the end of the year and has an expected growth rate of dividends of 5%. A. $12.45 B. $21.43 C. $22.50 D. $12.50 E. none of the above 2. Calculate the price one year ago for a stock that sells today for $45, just paid an annual dividend of $2.50, and experienced a 20% return over the past year. Ignore taxes. A. $56.25 B. $37.50 C. $39.58 D. $35.42 E. none of the above 3. If the required return is 10%, find the current value of a stock that just paid a $2 dividend and has an expected growth rate of dividends of 5%. A. $21 B. $42 C. $40 D. $20.95 E. none of the above 4. Find the value of a stock that is expected to pay a $2 dividend in one year. The dividend is not expected to grow. The required return is 10% APR. A. $19.90 B. $20 C. $0.20 D. $1.82 E. none of the above 5. Find the required return on equity for a $30 stock that just paid a $2 dividend and has an expected growth rate of dividends of 4%. A. 6.93% B. 10.93% C. 10.67% D. 2.93% E. none of the above 6. Calculate the payout ratio for a firm with a growth rate in dividends of 5% and a required return on equity of 20%. A. 25% B. 75% C. 15% D. 85% E. none of the above Use the following information to answer Questions 7 and 8. A company plans to pay a $4 dividend next year, which represents 100% of expected earnings. This will provide investors with a 15% expected return. Alternatively, the company could plow back 40% of the earnings at the firm's current return on equity of 15%. 7. What is the value of the stock before the plowback decision? A. $40 B. $13.33 C. $44.44 D. $26.67 E. none of the above 8. What is the value of the stock after the plowback decision? A. $40 B. $13.33 C. $44.44 D. $26.67 E. none of the above 9. The XYZ Company just paid a dividend of $1.50 per share (from earnings of $3 per share). The required return on equity is 20%. What is their present value of growth opportunities? A. $1.50 B. $0.50 C. $7.50 D. $9.00 E. none of the above 10. Your stock just paid a $1 dividend. Dividends are paid once per year. For the next two years, dividends are expected to grow at a super high rate of 15%, then fall back to the long-term rate of 5%. If the required return is 8%, what is the correct price for this stock today? A. $46.29 B. $38.95 C. $56.21 D. $41.88 E. none of the above