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# Lashgari Company: A stock just paid a dividend of \$1

6. A stock just paid a dividend of \$1. The required rate of return is rs = 11%, and the constant growth rate is 5%. What is the current stock price?

\$15.00
\$17.50
\$20.00
\$22.50
\$25.00

7. The Lashgari Company is expected to pay a dividend of \$1 per share at the end of the year, and that dividend is expected to grow at a constant rate of 5% per year in the future. The company's beta is 1.2, the market risk premium is 5%, and the risk-free rate is 3%. What is the company's current stock price?

\$15.00
\$20.00
\$25.00
\$30.00
\$35.00

8. An increase in a firm's expected growth rate would normally cause its required rate of return to

Increase.

Decrease.

Fluctuate.

Remain constant.

Possibly increase, decrease, or have no effect.

9.Harrison Clothiers' stock currently sells for \$20 a share. It just paid a dividend of \$1.00 a share (that is D0 = \$1.00). The dividend is expected to grow at a constant rate of 6 percent a year. What stock price is expected 1 year from now? What is the required rate of return?

10. A stock is expected to pay a dividend of \$0.50 at the end of the year (that is, D1 = 0.50), and it should continue to grow at a constant rate of 7 percent a year. If its required return is 12 percent, what is the stock's expected price 4 years from today?

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6. A stock just paid a dividend of \$1. The required rate of return is rs = 11%, and the constant growth rate is 5%. What is the current stock price?

\$15.00
\$17.50
\$20.00
\$22.50
\$25.00