1. JEN Corp. is expected to pay a dividend of $4.25 per year indefinitely. If the appropriate rate of return on this stock is 11 percent per year, and the stock consistently goes ex-dividend 30 days before dividend payment date, what will be the expected minimum price in light of the dividend payment logistics?

$38.64

$38.31

$34.06

$42.52

2. Balloons Inc normally pays a quarterly dividend. The last such dividend paid was $1.20, all future quarterly dividends are expected to grow at 8 percent, and the firm faces a required rate of return on equity of 13 percent. If the firm just announced that the next dividend will be an extraordinary dividend of $2.40 per share that is not expected to affect any other future dividends, what should the stock price be?

$19.20

$26.90

$25.61

$25.92