1. A project has the following cash flows, for years 0 through 3 respectively: -23,352, 12,630, 14,201, 11,516. If the required return is 10.8 percent, what is the profitability index?
2. Last week, Onboard Co. has announced that the next two annual dividends will be in the amount of $2.66 and $4.01, respectively. After that, the dividends will increase by 2.02 percent annually. The required return on this stock is 12.99 percent. What is the current price per share? (Hint: draw this out on a timeline.)
3. SRS, Inc. just paid an annual dividend of $2.77 last month. The required return is 14.8 percent and the dividend growth rate is expected to be constant at 3.5 percent. What is the expected value of this stock ten years from now?