1. Red, Inc., Yellow Corp., and Blue Company each will pay a dividend of $3.25 next year. The growth rate in dividends for all three companies is 4 percent. The required return for each company’s stock is 9 percent, 12 percent, and 15 percent, respectively. What is the stock price for each company? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)
2. Why can an investor's annual return (who is making periodic investments of differing amounts) in the same "fund" the manager is managing differ from what the manager publishes as their annual investment return? (assume there are NO management fees)