Question 1
Aluworks Co. is expected to pay a $21.00 dividend next year. The
dividend will decline by 10 percent annually for the following
three years. In year 5, Aluworks will sell off assets worth $100
per share. The year 5 dividend, which includes a distribution of
some of the proceeds of the asset sale, is expected to be $60. In
year 6, the dividend is expected to decrease to $40 and will be
maintained at $40 for one additional...