1. Weston Corporation just paid a dividend of $2.5 a share (i.e., D0 = $2.5). The dividend is expected to grow 9% a year for the next 3 years and then at 4% a year thereafter. What is the expected dividend per share for each of the next 5 years? Round your answers to two decimal places.
2. You're at the car dealership trying to see which car you can afford to buy. The salesperson tells you that she can sell you a new car that's worth $30,000 at a 3.25% interest rate for 7 years. Your monthly budget for a car is $450. Can you afford this deal?