1. Lee Hong Imports just paid a $1.00 per share annual dividend yesterday. Dividends are expected to increase by 5% annually. What is one share of this stock worth to you today if investor required rate of return is 14%?

2. Assume that three years ago you purchased a $1,000 corporate bond that pays 5.8 percent. What is the annual dollar amount of interest that you receive from your bond investment? Amount of annual interest $_______

3. The Medical Equipment Company paid $2.25 common stock dividend last year. The company’s policy is to allow its dividend to grow at 5 percent per year indefinitely. What is the value of the stock if the required rate of return is 8 percent? (constant growth model)