Question1: Lee Hong Imports paid a $1.00 per share yearly dividend last week. Dividends are expected to rise by 5% annually. What is one share of this stock worth to you today if the appropriate discount rate is 14 percent?
[A] $11.11
[B] $11.67
[C] $12.25
[D] $7.14
[E] $7.50
Question2: Angelina's made two statements concerning its common stock today. 1st, the company announced that its next year dividend has been set at $2.16 a share. 2nd, the company announced that all future dividends will increase by 4% yearly. Calculate the maximum amount you should pay to buy a share of Angelina's stock if your goal is to receive a 10% rate of return?
[A] $27.44
[B] $34.62
[C] $36.00
[D] $21.60
[E] $22.46