1. Based on the following information for a common stock:
Dividend per share just paid (D0) = $4
Required rate of return (Rs) = 10%
Expected constant growth rate (g) = 5%. What is the expected price of the stock?
Select one:
a. $93.75
b. $84
c. $77.84
d. $88.29
2. A debenture is:
long-term debt secured by real estate.
unsecured debt that generally matures in ten years or more.
long-term debt secured by fixed assets of the borrower.
short-term unsecured commercial papers.