1. Lilly Pad Company has just announced that they will pay their first dividend of $30 in twelve years and grow that dividend at 5% per year afterward. If your required return is 22%, what is the most you would be willing to pay for the stock today? A. $176.47 B. $16.23 C. $33.18 D. $19.80
2. Gogle, Inc, has announced that it intends to make its first ever dividend payment of $3 per share in six years. If you require a return of 15% and believe the dividend will grow at 10% per year after it is issued, what is the most you would be willing to pay today for the stock?
A. $29.83
B. $60.00
C. $25.94
D. $28.18
3. You find a stock that just paid a dividend of $2.20 that is expected to grow at 25% per year for the next three years, then a constant 6%. If the required return of the stock is 11%, what should be the price of the stock today?
A. $91.09
B. $75.02
C. $77.22
D. $85.75