Reference no: EM132485814

Question 1: Tresnan Brothers is expected to new' a $2.60 per share dividend at the end of the year {i.e., D1 = $2.90}. The dividend is expected to grow at a constant rate of 5% a year. The required rate of return on the stock, r5, is 20%. What is the stock's current value per share? Round your answer to the nearest cent.

Question 2: Computech Corporation is expanding rapidly and currently needs to retain all of its earnings; hence, it does not pay dividends. However, investors expect Computech to begin paying dividends, beginning with a dividend of $0.50 coming 3 years from today. The dividend should grow rapidly - at a rate of 24% per year - during Years 4 and 5, but after Year 5, growth should be a constant 4% per year. If the required return on Computech is 14%, what is the value of the stool-c today? Do not round intermediate calculations. Round your answer to the nearest Cent

Question 3: Farley Inc. has perpetual preferred stock outstanding that sells for $33 a share and pays a dividend of $3.00 at the end of each year. What is the required rate of return? Round your answer to two decimal places.