Answer Happy

14. Gagliardi Way Corporation has an expected ROE of 15%. Its dividend growth rate will if it follows a policy of paying 30% of earning in the form of dividends. be A) 4.5% B) 10,5% C) 15.0 % D) 30.0% 15. Rose Hill Trading Company is expected to have EPS in the upcoming year of $8.00. T expected ROE is 18.0%. An appropriate required return on the stock is 14%. If the fir has a plowback ratio of 70%, its dividend in the upcoming year should be A) $1.12 B) $1.44 C) $2.40 D) $5.60 16. Rose Hill Trading Company is expected to have EPS in the upcoming year of $6.00. expected ROE is 18.0%. An appropriate required return on the stock is 14%. If the fi has a plowback ratio of 70%, its intrinsic value should be A) $20.93 B) $69.77 C) $128.57 D) $150.00 17. Ace Ventura, Inc. has expected earnings of $5 per share for next year. The firm's R 15% and its earnings retention ratio is 40%. If the firm's market capitalization rate (required return) is 10%, what is the present value of its growth opportunities? A) $25 B) $50 C) $75 D) $100 18. Annie's Donut Shops, Inc. has expected earnings of $3.00 per share for next year. firm's ROE is 18% and its earnings retention ratio is 60%. If the firm's market capitalization rate (required return) is 12%, what is the value of the firm excludin growth opportunities? A) $25.00 B) $50.00 C) $83.33 D) $208