1. A credit card quotes a rate of 18% APR. Monthly payments are required and minimum payment due is $20. How long will it take you to pay off the card if you make only minimum payment? What is the actual rate of interest you pay on the credit card?
2. A stock is expected to pay a dividend next year of $2.3. The dividend amount is expected to grow at an annual rate of 6.7% indefinitely. Assuming a required return on the stock of 12% in the future, the dividend yield on the stock is ______%.
3. A stock is expected to pay the following dividends: $1.3 in 1 year, $1.6 in 2 years, and $2 in 3 years, followed by growth in the dividend of 7% per year forever after that point. The stock's required return is 12%. The stock's current price (Price at year 0) should be $____________.