**EXAMPLES-1**

**1.** Most recently paid dividend of a corporation is 7 TL per share. This is a zero growth (no-growth) stock. If the required rate of return of the investors is 16 %, what is the intrinsic value (price) of the stock now?

**2. **A corporation’s most recently paid dividend is 4 TL per share. The dividend is expected to grow at a constant rate of 8 % each year. If the required rate of return of the investors is 14 %, what is the intrinsic value value (price) of the stock now?

**3. **A corporation’s most recently paid dividend is 1.75 TL per share. The dividend is expected to grow at a constant rate of 5 % each year. If the price of the stock is 25 TL now, what is the required rate of return of the investors?

**4.** A corporation’s most recently paid dividend is 3 TL per share. Return on equity is 20 %. Plowback ratio is 30 %. Required rate of return of the investors is 12 %. What is the intrinsic value (price) of the stock now?

**5.** A corporation’s most recently paid dividend is 4 TL per share. The dividend is expected grow at a constant rate of 7 % each year. The required rate of return of the investors is 12 %.

a.What is the intrinsic value (price) of the stock now?

b.What part of the value is due to current assets, what part is due to growth opportunities?

**6. **Next dividend of a corporation is expected to be 2 TL per share. The dividend is expected to grow at a constant rate of 6 % each year. If the required rate of return of the investors is 15 %, what is the intrinsic value (price) of the stock now?

**7. **A corporation’s most recently paid dividend is 2.40 TL per share. The dividend is expected to grow at a constant rate of 5 % each year. If the required rate of return of the investors is 12 %, what is the intrinsic value (price) of the stock at the end of the 4^{th} year?

**8. **A corporation’s most recently paid dividend is 2 TL per share. The dividend is expected to grow at rate of 20 % for the next 4 years. Beginning from the fifth year the dividend will grow at a constant rate of 8 % each year. If the required rate of return of the investors is 15 %, what is the intrinsic value (price) of the stock now?

**9. **Halkbank’s stock price is expected to be 12.38 TL at the end of the first year. Constant growth rate of Halkbank is 5 %, required rate of return of the investors is % 15.5, return on equity is % 13.

**a.**What is the expected dividend of Halkbank next year?

**b.**What is the most recently paid dividend of Halkbank?

**c.**What is the plowback ratio of Halkbank.