1. For two put options identical in every respect except the exercise price, the option with a higher exercise price should have a lower premium." True or false?

2. Last year, Lakesha’s Lounge Furniture Corporation had an ROA of 7.8 percent and a dividend payout ratio of 27 percent.

What is the internal growth rate? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

3. Marcel Co. is growing quickly. Dividends are expected to grow at a 16 percent rate for the next 3 years, with the growth rate falling off to a constant 3 percent thereafter.

If the required return is 8 percent and the company just paid a $3.70 dividend. what is the current share price?