1. The dividend for Weaver, Inc., is expected to grow at 21 percent for the next 4 years before leveling off at a 5.8 percent rate indefinitely. If the firm just paid a dividend of $1.2 and you require a return of 14 percent on the stock, what is the most you should pay per share?
2. How does the bond rating affect an investor's required rate of return? What factors affect a bond's rating?