Question: X = 2 ! ! Suppose Big Al's Pizza, Inc. just paid a dividend of $ 0 . 7 5 . It is expected to

= 2!!

Suppose Big Al's Pizza, Inc. just paid a dividend of $

0.75 .

It is expected to increase its dividend by

4 %

per year. If the market requires a return of

x %

on assets of this risk, how much should the stock be selling for?

The News Company is expected to pay a dividend of $

10

next period and dividends are expected to grow at

x %

per year. The required return is

18 % .

What is the current price?

Suppose we are trying to value the company Beta Investments, an investment firm that does not pay dividends. If the appropriate industry PE for this type of company is

15

and you predict earnings to be $ X

. 00

per share for the coming year. What is the forecasted stock price for a year from now?

X=2!! Suppose Big Al's Pizza, Inc. just paid a dividend of

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