5. The past four dividends for the Zywicki Corporation are shown below. Calculate dividend D_1 by applying the historical (arithmetic) average growth rate of dividends. Compute the expected share price at the end of 2023 using the perpetual dividend growth method. Assume the market risk premium is 11.7 percent, Treasury bills yield 5.9 percent, and the beta of the firm is 0.88. (6 POINTS) Dividend, $ Year 2023 2022 2021 2020 1.80 1.65 1.50 1.40 A. What is the historic, arithmetic average growth rate? $1.23 X B. What is the discount rate, k? 11.7% X P = 1.80 t + 1.117 1.65 (1.117) 2 (1,117)³ 1.50 3 3+1.40 (1.11714 =4.9/4 =1.227 C. What is the share price at the end of 2023? Х

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The current price of stock A is $40. The expected dividend for the next year is $2. The dividend is expected to grow at a constant growth rate in the future. The required return of stock A is 15%. Using constant-growth dividend model, the implied dividend growth rate is _______. A. 10% B. 5% C. 15% D. 0%

None

Use the dividend discount model to value a share of Toyota’s stock (ticker symbol: TM) as of December 31, 2021. In your application of this model, use the data provided on the most recent Toyota Value Line report to estimate the necessary dividend payment and the firm’s equity beta. Assume, that the expected growth rate of dividends in perpetuity (g) ranges from 2.5% to 3.5%/year.

Use the Constant Dividend Growth Model to determine the expected annual growth rate of the dividend for ELO stock. The firm is expected to pay an annual divided of $8.9 per share in one year. ELO shares are currently trading for $144.48 on the NYSE, and the expected annual rate of return for ELO shares is 12.86%. Answer as a % to 2 decimal places (e.g., 12.34% as 12.34).

Use the historical dividend data below to calculate the constant growth rate, estimate the price of O'Brien Ltds’ common stock knowing that the investor has an 19% required rate of return. 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 $0.41 $0.48 $0.56 $0.65 $0.75 $0.88 $0.99 $1.10 $1.13 $1.39   Question 10Answer a. g= 17.50% and Price (P0) = $56.43 b. g= 14.04% and Price (P0) = $31.49 c. g= 27.4% and Price (P0) = $300.81 d. g= 14.53% and Price (P0) = $35.60

1. XYZ Corporation is currently paying a dividend of $1.5 per share and is expected to increase this dividend by 10% per year for the next two year. After this, dividends are expected to grow at a stable rate of 4% annually. If the required rate of return on the stock is 8%, what is the current value of a share? A. $40.00 B. $42.25 C. $47.19 D. $43.62 2. JW Corporation is expected to pay a dividend of $1.80 per share next year. After that, dividends are expected to grow by 3% annually indefinitely. The current stock price is $30.00. If your required rate of return is 10%, should you purchase the stock today? Why or why not? A. No; The stock has a present value of $31.50 per share. B. Yes; The stock has a present value of $31.50 per share. C. No; The stock has a present value of $25.71 per share. D. Yes; The stock has a present value of $25.71 per share. E. No; The stock has a present value of $36.00 per share.

B

Procter and Gamble​ (PG) paid an annual dividend of $2.79 in 2018. You expect PG to increase its dividends by 7.9% per year for the next five years​ (through 2023), and thereafter by 2.7% per year. If the appropriate equity cost of capital for Procter and Gamble is 8.9% per​ year, use the​ dividend-discount model to estimate its value per share at the end of 2018.