1.A share of common stock has just paid a dividend of $4.00.If the expected long-run growth rate for this stock is 7%, and if investors require a(n)

1.      A share of common stock has just paid a dividend of $4.00. If the expected long-run growth rate for this stock is 7%, and if investors require a(n) 11% rate of return, what is the price of the stock?

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3.      A company has a profit margin of 25%, an asset turnover ratio of 1.5, and an equity multiplier ratio of 1.65, both the tax burden and the interest burden are at 1, if the profit margin decreases to 20% but the asset turnover ratio decreases to 1.3, what will be company's new ROE?

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6.      Motor Homes Inc. (MHI) is presently enjoying abnormally high growth because of a surge in the demand for motor homes. The company expects free cash flow to grow at a rate of 20% for the next 4 years, after which there will be no growth (g = 0) in FCFF. The company's last FCFF, FCFF0, was $1.50. The firm is consisted of 100% equity and has no debt. MHI's beta is 1.5, the market risk premium is 6%, and the risk-free rate is 4%.  Given there's no debt, what is the current equity value of the firm using DCF model?

7.      Company A's current free cash flow is $2 dollars and forecasts its FCFF to grow at 0% for 2 years, then 10% for 2 years, then at 5% forever. The firm is consisted of 100% equity and has no debt. If the company's beta is 1.5, the risk free rate is 2% and the market return is 10%. What will be the equity value of the firm today using DCF model?

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