Reference no: EM132619782

Problem 1: A company a constant growth rate of 3%. The company's risk adjusted discount rate is 5%. The company has a $2 dividend. What is the per share value of the stock?

Group of answer choices

Option 1: $51.50

Option 2: $105

Option 3: $52.50

Option 4: $103

Problem 2: A company goes bankrupt and its assets are to be divided between its shareholders and debtholders. Which of the following, from highest priority to lowest, is the correct order of how the company's assets should be divided?

Group of answer choices

Option 1: Bondholders, preferred shareholders, common shareholders.

Option 2: Preferred shareholders, common shareholders, bondholders.

Option 3: Preferred shareholders, bondholders, common shareholders.

Option 4: Bondholders, common shareholders, preferred shareholders.