1. Leisure Lodge Corporation is expected to pay the following dividends over the next four years: $20.00, $15.00, $5.40 and $2.60. Afterwards, the company pledges to maintain a constant 6 percent growth rate in dividends forever. If the required return on the stock is 17 percent, what is the current share price? (Do not round intermediate calculations. Round your answer to 2 decimal places.)
2. Netscrape Communications does not currently pay a dividend. You expect the company to begin paying a dividend of $3.80 per share in 8 years, and you expect dividends to grow perpetually at 4.8 percent per year thereafter. If the discount rate is 17 percent, how much is the stock currently worth? (Do not round intermediate calculations. Round your answer to 2 decimal places.)