Question 4 (3 points) In practice, a common way to value a share of stock when a company pays dividends is to value the dividend over the next five to seven years and then find the terminal stock price using a benchmark PE ratio. Suppose a company just paid a dividend of $1.28. The dividends are expected to grow at 9 percent over the next five years. In five years, the estimated payout ratio is expected to be 40 percent and the benchmark PE ratio is expected to be 20. The required return for the company's stock is 15 percent. What is the target stock price in five years? Enter your answer as dollars with 2 digits to the right of the decimal point in the box shown below. Your Answer: Answer Question 5 (3 points) A young start-up company needs to plow back its earnings to fuel growth. The company will pay no dividends on its stock until it pays its first dividend of $12 per share 10 years from today. Thereafter, it will increase the dividend by 3 percent per year. If the required return on this stock is 11 percent, what is the current share price? Enter your answer as dollars with 2 digits to the right of the decimal point in the box shown below. Your