1. Calculate the return on equity given the following information: common shares outstanding = 300,000; earning per share = $4.00; total assets = $5,000,000; total equity = $3,000,000.
2. Estes Park Corp. pays a constant $7.85 dividend on its stock. The company will maintain this dividend for the next 12 years and will then cease paying dividends forever. If the required return on this stock is 9 percent, what is the current share price?